UBS has increased its price objective on Gilead Sciences Inc. to $175 from $155 while maintaining a Buy recommendation, citing near-term clinical readouts as the primary justification for the upgrade. The revised target implies upside relative to Gilead's recent share price of $153.26, with the stock trading close to its 52-week high of $157.29.
The brokerage singled out an approaching data set as the pivotal development: six-month pharmacokinetic results from integrase inhibitor candidates for HIV, expected to be presented by both Gilead and GlaxoSmithKline at the Conference on Retroviruses and Opportunistic Infections taking place Feb. 22-25. UBS framed those Phase I data as the next wave of the company's HIV-focused product pipeline.
Gilead's stated strategy is to develop long-acting therapies that would allow patients to move off daily oral regimens - including its flagship Biktarvy - toward dosing intervals measured in months. That approach follows company efforts in the prevention market with Yeztugo for pre-exposure prophylaxis, but UBS emphasized this program's orientation toward HIV treatment. The bank described the HIV treatment market as roughly a $15 billion opportunity in which Gilead currently holds a leadership position.
Patent protection for Biktarvy extends through 2036. UBS noted that, if Gilead successfully advances its long-acting candidates, the company could transition patients to these newer formulations and thereby help preserve base business revenue beyond the life of Biktarvy's primary patent estate. Investors have bid the stock higher over the past year; Gilead has delivered a 51.65% total return in that period and has increased its dividend for 11 consecutive years, currently yielding 2.11%.
Gilead's recent financials provide additional context for analyst revisions. The company reported fourth-quarter revenue of $7.93 billion, topping consensus estimates of $7.70 billion, and posted adjusted earnings per share of $1.86 versus the $1.83 expected by analysts. UBS and other firms highlighted strong performance in both the firm's HIV and oncology franchises as central to the beat.
Those results prompted several research firms to revisit their outlooks. Wolfe Research raised its target to $170 and pointed to significant growth within the HIV portfolio, including a 31% year-over-year increase for Descovy and the launch performance of Yeztugo. Truist Securities increased its target to $152, while Bernstein SocGen Group and BMO Capital set targets at $160. Goldman Sachs, however, left a Neutral rating in place with a $125 price objective, noting that earnings and revenue exceeded expectations despite their more cautious stance.
Analyst price targets for Gilead across the market span a wide range; InvestingPro data show targets between $118 and $177. UBS' move to $175 places it near the top end of that distribution and signals its view that upcoming Phase I pharmacokinetic data could materially affect investor expectations for the company's HIV roadmap.
Implications for markets and products
From a product and market-structure perspective, the most important elements are the potential for long-acting therapies to change treatment adherence and to extend pricing power past existing patent expirations. UBS is explicitly tying valuation upside to those clinical milestones, and the market response so far suggests investors are pricing in the prospect of durable franchise revenue growth.
What to watch next
- Presentation of six-month pharmacokinetic data for integrase inhibitor candidates at the Feb. 22-25 conference.
- Further adjustments to analyst price targets as the clinical readouts and uptake metrics become clearer.
- Execution on commercial strategy to transition patients from daily oral regimens to long-acting formulations if the data are supportive.