Gilead Sciences, Inc. (GILD) Stock Valuation — PE Analysis
Drug Manufacturers - General · NASDAQ
Current Price
$125.59
PE Ratio (TTM)
16.9x
Intrinsic Value
$183.08
+31.4% margin of safety
COMPETITIVE MOAT
↑HIV Market Dominance
Gilead holds a commanding position in the HIV market with a strong portfolio of treatments. This established market share creates significant barriers to entry for competitors.
↑Oncology Pipeline Expansion
Strategic acquisitions like Ouro Medicines bolster Gilead's oncology and inflammation pipelines. This diversification aims to reduce reliance on existing revenue streams and capture future growth.
↑Lenacapavir Access Initiatives
Gilead's efforts to expand access to lenacapavir for HIV prevention, as seen in South Africa, demonstrate a commitment to global health. This can foster goodwill and long-term market penetration.
INVESTMENT RISKS
↓Patent Expirations
Key drug patents will eventually expire, opening the door for generic competition. This poses a significant threat to revenue from established blockbuster drugs.
↓Clinical Trial Failures
The drug development process is inherently risky, with a high rate of failure. Setbacks in clinical trials for promising new therapies could impact future growth.
↓Regulatory Hurdles
Gaining regulatory approval for new drugs is a complex and lengthy process. Delays or rejections from regulatory bodies can significantly hinder market entry and revenue generation.
Base case
GILD base case PE valuation
A base case PE valuation for GILD estimates a fair value of about $183.08 per share, against a current price of $125.59. The model assumes 12.8% annual earnings growth, a 17x target PE multiple, and a 10% discount rate.
Intrinsic Value
$183.08
Margin of safety
+31.4%
Expected annual return
+7.8%
Base case assumptions: 12.8% annual earnings growth, 17x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the GILD PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Gilead Sciences, Inc. respond.
Open PE Calculator for GILDCompany Overview
Gilead Sciences, Inc. is a global biopharmaceutical enterprise, with operations spanning the United States, Europe, and numerous international markets. Its core mission involves discovering, developing, and commercializing innovative medications to address critical health needs. The company's extensive product portfolio encompasses treatments for a variety of severe conditions. For HIV/AIDS, it supplies key therapies such as Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/Eviplera, Stribild, and Atripla. In response to the 2019 coronavirus pandemic, Gilead provides Veklury, an injectable drug for intravenous administration. Its offerings for liver diseases include Epclusa, Harvoni, Vosevi, Vemlidy, and Viread. Furthermore, Gilead assists patients battling hematological disorders, various cancers, and those undergoing cell therapy, through products like Yescarta, Tecartus, Trodelvy, and Zydelig. Other specialized medicines include Letairis, an oral drug for pulmonary arterial hypertension; Ranexa, also an oral medication, for chronic angina; and AmBisome, a liposomal formulation designed to combat serious invasive fungal infections. Gilead Sciences, Inc. actively engages in collaboration agreements with a diverse range of partners to advance its therapeutic pipeline. These include Arcus Biosciences, Inc., Pionyr Immunotherapeutics Inc., Tizona Therapeutics, Inc., Tango Therapeutics, Inc., Jounce Therapeutics, Inc., Galapagos NV, Janssen Sciences Ireland Unlimited Company, Japan Tobacco, Inc., Gadeta B.V., Bristol-Myers Squibb Company, Dragonfly Therapeutics, Inc., and Merck & Co, Inc. The company was founded in 1987 and its corporate headquarters are situated in Foster City, California.
Financial Metrics — GILD PE Stock Valuation Data
PE Ratio (TTM)
16.9x
PEG Ratio
0.31
Earnings Yield
5.91%
ROE (TTM)
42.2%
Revenue/Share (TTM)
$23.94
Dividend Yield
2.56%
Debt/Equity
0.94x
Frequently Asked Questions
What is the PE ratio of GILD?
The trailing twelve-month PE ratio of GILD reflects how much investors pay per dollar of Gilead Sciences, Inc.'s earnings. This metric is most useful when compared to Drug Manufacturers - General peers and the company's own historical range.
Is GILD overvalued based on PE ratio?
GILD's PE of 16.9x combined with a PEG ratio of 0.31 provides a growth-adjusted perspective. A PEG below 1.0 suggests GILD may be undervalued relative to its earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Drug Manufacturers - General, a DCF analysis may be more appropriate.
How do I value GILD stock using PE ratio?
To value Gilead Sciences, Inc. using PE: (1) Compare the current PE (16.9x) against the Drug Manufacturers - General median to assess relative pricing, (2) check the PEG ratio (0.31) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of GILD?
GILD's PEG ratio is 0.31, calculated by dividing the PE ratio (16.9x) by the expected earnings growth rate. A PEG below 1.0 is traditionally considered a sign of undervaluation — the market may not be fully pricing in the growth potential. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for GILD stock valuation?
PE ratio gives a quick relative read — how GILD is priced versus Drug Manufacturers - General peers. DCF provides an absolute value based on projected free cash flows. For GILD, with a strong ROE of 42.2%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See GILD DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Healthcare valuationsP/E and DCF value GILD with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.