What drove GILD's consistent earnings beat in 2024?

Gilead Sciences (GILD) has consistently exceeded earnings expectations due to its strong performance in the HIV and hepatitis C drug markets, particularly driven by the growth of its flagship treatment Biktarvy. Here are the key factors contributing to GILD's consistent earnings beat: 1. **Growth of Biktarvy**: Biktarvy, a once-daily, single tablet regimen, has been a significant driver of GILD's revenue growth, accounting for approximately 45% of the company's total HIV revenue in 2024. Its strong performance is attributed to its convenient dosing regimen and high efficacy. 2. **HIV Franchise Strength**: GILD's HIV franchise continues to show strength, with total sales from this franchise reaching $19.6 billion in 2024, an 8% increase year-over-year. The company's focus on innovation in HIV treatment, including efforts on prevention, has contributed to this growth. 3. **Valuation and Earnings Metrics**: GILD's shares are trading at a forward earnings multiple of 14.1X, indicating that the market is currently valuing the company's future earnings highly. The P/E ratio of 0.7 and Price/Cash Flow ratio of 16.2X also suggest that the stock may be undervalued relative to its earnings and cash flow generation. 4. **Analyst Confidence**: Analysts have shown confidence in GILD's earnings potential, with recent revisions to estimates reflecting this positivity. The Zacks Consensus Estimate for GILD's full-year earnings has moved 4.2% higher within the past quarter, indicating a growing expectation for strong earnings performance. 5. **Market Outperformance**: Despite some market volatility, GILD has outperformed the S&P 500 and its peers in the Medical sector, which has contributed to its stable earnings performance. In summary, GILD's consistent earnings beat in 2024 can be attributed to the strong performance of its HIV franchise, particularly driven by Biktarvy, combined with favorable valuation metrics and analyst confidence.