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Bullish Breakout Boosts Target for Top Biotech

Gilead Sciences blasted through resistance from a 'V' formation


Gilead Sciences (GILD) — This has been a favorite biotech stock of mine since I recommended it on Nov. 19, near $37.50. On Aug. 29, at just over $60, I reiterated my positive opinion of the stock, citing an increase in earnings estimates by S&P to $1.86 in 2013 and $2.78 in 2014.

At that time, I said, “New hepatitis C drugs and stabilization in market share for their leading HIV drug are expected to enhance future earnings; thus, GILD should be high on the list of biotech stocks in investors’ portfolios.”

Technically the stock is still in a clearly defined bull channel, but it has enhanced its potential by breaking through resistance at $64 from a “V” formation. My trading target had been $67, but Wednesday’s bullish breakout boosted my target to $72. The stock could also be positioned as a long-term hold with a 12-month target of over $80.

GILD Chart
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