HSBC upgraded Gilead Sciences (GILD.BA) from Hold to Buy. The bank raised its price target for the stock from $133.00 to $155.00.
Analysts suggest the market is overly pessimistic regarding the impact of generics on Gilead's HIV franchise. Long-acting HIV therapies are expected to improve patient adherence and support sales above consensus estimates.
Growth drivers include the PrEP drug Yeztugo and oncology catalysts such as anito-cel and Trodelvy. Trodelvy received U.S. and European approvals in late June as a first-line treatment for metastatic breast cancer.
HSBC noted that a recent share price correction leaves the stock valued at 13 times next year's earnings.