Gilead a "Media Stock"?

Old_Joe

No, of course not. I asked that, though, as a larger question regarding the sector stability of this market. OK, "media stocks" are taking a beating, and with spillover effects today's overall market (S&P) is down about 1% at this time. But I've been watching Gilead, and today it's down about 3%. So I have to wonder about the rationality of a market that drives down a stock in a sector that has absolutely nothing to do with "media" at a ratio 3x that of the overall market. How can we make a rational decision regarding the likely direction of a stock like Gilead when it is apparently heavily influenced by factors that have absolutely nothing to do with the company or it's sector?

Edit/Add: The following by Scott, from his "Media Stocks Obliterated" post:

"Obviously not technical in nature or anything beyond a feeling, but market feels as if there's considerable underlying unease."

Yes, exactly.

scott

Gilead has previously gone down after outstanding earnings reports. For some reason, the dividend did not seem to do much to create longer-term (or even somewhat less short-term oriented) shareholders in that stock. Trading at a 12 p/e, Gilead may be somewhat more volatile than I'd like or expect, but I'm not concerned about Gilead on a day-to-day basis. I have admittedly been paring back on things that are more volatile (I've sold a little more BX and have added more to OAK, as I think if we head South in a deflationary scenario, I think there is the potential that OAK - which is the largest distressed investor - could have a feast to choose from), but that is not one of them. Keeping CELG, too.

CELG is not cheap, but they have laid out what they see as the next 5 years. It may be a bumpy ride, but the company has a convincing track record. If they can meet projections, I think there's more room to the upside (but again, between here-and-there may be bumpy.)

Have been adding to Ecolab (ECL), the definition of enjoyably dull - down maybe half a percent on a lousy day and was up earlier. Abbott (ABT) also not doing much.

little5bee

@Old_Joe @scott heard on cnbc that there is "forced selling" by pension funds of hc stocks.

Old_Joe

@little5bee- Your info suggests that there may be a "common denominator", since you mention "pension funds" (plural). And the "forced selling" description is very interesting also. Did cnbc have any idea what might be "forcing" the pension funds to sell?

Thanks-

little5bee

@Old_Joe - nope, sorry, channel surfing between cnbc and golf, so I may have missed it. might be on the cnbc website?

Old_Joe

@little5bee- OK, thanks...will look around.

scott

little5bee said:

@Old_Joe @scott heard on cnbc that there is "forced selling" by pension funds of hc stocks.

Good. Perhaps I'll buy more.

I'll also note that something that interests me is the Walgreens (WBA) partnership with Theranos.

Walgreens has Theranos stations in 40 or so stores but will be rolling out to many more.

http://www.businessinsider.com/science-of-elizabeth-holmes-theranos-2015-4

http://fortune.com/2015/05/07/theranos-jump-starts-consumer-lab-testing/

http://www.walgreens.com/pharmacy/lab-testing/home.jsp

Walgreens also has a stake in Amerisource Bergen (ABC), which has done rather well.

little5bee

@Old_Joe I would only share this info with my friends

Mark

Possibly as simple as sell the winners, buy the losers rotation. Not good on the whole if this continues. Watch the Nasdaq.