Barclays Initiates Coverage Of Gilead Sciences At Overweight

Geoffrey Meacham of Barclays initiated coverage of

on Tuesday with an Overweight rating and $125 price target. According to Meacham, Gilead Sciences' will likely see “dramatic growth” in hepatitis C that should drive upside in 2015 and beyond. Specifically, the analyst projects that Harvoni could begin to “play out” in 2015 with a forecasted $16.9 billion in worldwide sales. According to Meacham, the company should remain ahead of its peers, especially considering the completion of phase 3 data for Sovaldi which will come out in the second half of 2015. The analyst notes that Sovaldi represents the “next evolution” in hepatitis C that has “broad commercial potential.” Meacham also points out that beyond hepatitis C, Meacham states that simtuzumab has initial de-risk data in the second half of the year in NASH and with broad applicability in fibrotic diseases. Additionally, the analyst believes that the market is discounting the company's TAF launch (HIV) and other assets in categories such as hepatitis B, RSV and oncology. Finally, the company's $30 billion plus in cash flow over the next two years provides many options including aggressive buybacks as well as merger and acquisition opportunities.