Spicing Things Up with GILD

[Robandcindy2]

When I'm on layovers with nothing to do around dinner time I usually have a burger in Cra-Merica....love him or hate him he can be entertaining and somewhat educational. Now this thread isn't about Jim but about his love of the 4 Horsemen of Biotech (REGN, CELG, BIIB, GILD).

So his reporting had me thinking about adding a little spice to our portfolio. I mean, "who doesn't like hitting a home run?" (Yeah, mixed metaphor-sorry).

As I started to contemplate buying some aggressive growth companies I found my inner voice whispering louder and louder "Rob...Rob!....What are you doing Rob??!!" Quite eerily Chuck Carnevale over at SA (and FastGraphs) published this piece Are Growth Stocks Appropriate for Retirement Portfolios.

OK, so Chuck says "maybe" 10% in growth companies. So far so good. But what exactly is a Growth Company? I'll spare you my research but in a nutshell it is everything we don't own on this site. High EPS growth, usually high PE, PB, and low to zero dividends.

I did find this concise review at Zachs that I think we all can learn from: Growth Stocks versus Value Stocks. So remembering a cooking lesson from my Grandmother, "You can put spices in but you can't take them out..." I decided to throttle back and rethink this.

As Jim says, "The bottom line is this," a little kick is OK as long as all the numbers let you sleep well at night. Isn't Rule #1 "Don't Lose Money"?

GILD is on a tear:

   

36% forecast 5 year estimated total return.

Then there is this review over at SA: Gilead's Massive Undervaluation.

Wait! What? (Always cracks me up when my kids respond to me that way). So GILD has massive growth in it's future AND it is massively undervalued? Growth AND Value? What's not to like? (OK, a 3% yield would be a grand slam.)

Will this be our walk off game winner? Certainly not. I'm am not changing tactics now with a portfolio growing at 10% with a 3.38% yield and 2-7 years until I turn in my wings. But if GILD has it's A-game, it's going into our line-up.

Time will tell....