Gilead’s (GILD) recent breakout to new 52-week highs is constructive and reflects improving investor sentiment around its leadership in HIV therapies and expanding oncology pipeline. The recent pullback provides an attractive risk/reward entry for adding upside exposure, especially given its strong fundamentals relative to peers. Trade timing and outlook GILD has trended higher throughout 2025, with a breakout above $120 earlier this summer confirming a new 52-week high. Shares have since pulled back toward trendline support near $114, offering an attractive risk to reward entry. Relative strength remains supportive, with GILD outperforming its sector by more than 25% this year. Fundamentals Gilead is well-positioned in HIV leadership through Biktarvy, Descovy and the recent approval of Yeztugo for PrEP, reinforcing a durable cash flow foundation. Its oncology expansion, including Trodelvy and cell therapies, opens new multibillion-dollar markets. Financially, GILD remains resilient with industry leading profitability and efficiency, including margins, robust ROE and consistent free cash flow generation. Its valuation appears attractive, trading at lower P/E and PEG ratios versus the biotech sector despite stronger growth expectations. Forward PE ratio: 14x vs. industry average 12x Expected EPS growth: 24% vs. industry average 6% Expected revenue growth: 4% vs. industry average 4% Net margins: 21.9% vs. industry average 16.1% Bullish thesis Franchise strength: Biktarvy continues to lead globally, while Descovy and Yeztugo expand Gilead’s footprint in prevention, bolstering long-term cash flow stability. Oncology as growth catalyst: Trodelvy’s label expansions and the company’s cell therapy portfolio represent potential multibillion-dollar growth opportunities. Attractive valuation: With higher expected EPS growth and stronger margins versus peers, GILD trades at a discount to the biotech sector. Resilient financials: Gilead generates strong free cash flow, has above-market yield and maintains a disciplined capital return policy. Options strategy To capitalize on the bullish outlook, I’m buying the Oct 17 $115/$125 Call Vertical @ $3.20 debit. This entails: Buying the Oct. 17 $115 Call @ $4.03 Selling the Oct. 17 $125 Call @ $0.83 Max profit: $680 per contract if GILD is above $125 at expiration Max risk: $320 per contract if GILD is below $115 at expiration Breakeven: $118.20 View this Trade with Updated Prices at OptionsPlay Summary Gilead’s leadership in HIV, accelerating oncology growth, strong profitability and discounted valuation underpin our bullish outlook. With the technical breakout confirming investor conviction and the pullback offering an attractive entry, the defined-risk call vertical captures upside exposure with a healthy risk to reward ratio. DISCLOSURES: None. All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
Using options to trade this pharma name that has multiple tailwinds in its favor
