Gilead Sciences Inc (NASDAQ:GILD) announced disappointing first-quarter earnings after the bell Tuesday, but Oppenheimer analysts advised investors not to panic.
The biopharmaceutical company reported earnings of US$1.48 per share on revenue of US$5.09 compared with US$2.23 EPS on revenue of US$6.5bn in last year’s first quarter.
READ: Gilead Sciences misses on 1Q earnings and revenue, maintains outlook
The California-based company missed consensus estimates of US$1.67 EPS on revenue of $5.4bn.
Shares fell more than 8% to US$66.63 in Wednesday morning trade.
The company maintained its full-year guidance for 2018 with sales between US$20bn to US$21 compared with estimates of US$21.29bn.
READ: Gilead Sciences strikes partnership with Alphabet's Verily
While the company did miss consensus estimates in all the key areas, Oppenheimer analysts Hartaj Singh and Emma Nealon argue that the expectations were too high in the first place. The results were in line with its biotech peers. Going forward, the analysts see sales strengthening.
The New York-based research firm gave the stock a Perform rating, expecting it to perform in line with the S&P 500.
Gilead develops treatments for a variety of medical issues, including HIV/AIDS, developing one of the first once-daily HIV treatments as well as one of the first oral antiretroviral pills.
Sales of immunotherapy drug Yescarta crushed Oppenheimer estimates, coming in at US$40mln versus estimates of US$20mln. As of the end of April, 40 cancer centers have authorized use of the drug and it should be available in Europe by the third quarter.
Gilead recently announced a partnership with Alphabet Inc’s (NASDAQ:GOOG) Verily Life Science in which the company will pay the biotech start-up as much as US$90mln over the next three years to perform a series of tests to research rheumatoid arthritis, inflammatory bowel disease, and lupus.
--Updates share price, adds analyst names