Author: Noah Kiedrowski

This Healthcare Juggernaut Continues To Deliver

Posted on by Noah Kiedrowski

Noah Kiedrowski - INO.com Contributor - Biotech


Introduction

I posited that CVS presented a compelling investment opportunity in the healthcare space. This premise was rooted in the fact that CVS has been highly acquisitive, robust growth rate, growing its dividends over time and has an aggressive share buyback program in place. CVS recently reported robust earnings and continued to drive and position itself for long-term success. With its recent acquisitions and partnerships, specifically the acquisition Target’s pharmacies and Omnicare will significantly expand its footprint and ability to dispense prescriptions to the general public and in assisted living and long-term care facilities that serve the senior patient population. As the United States continues to absorb an ageing population alongside growing overall healthcare costs, more specifically prescription drug costs, CVS looks poised to benefit and continue to outperform the broader market. The most recent earnings report underscores this premise and CVS continues to deliver continued growth and positioning for long-term success.

2015 Q3 Earnings

Recently, CVS reported strong earnings for the quarter ending September 30th, 2015. Net revenue increased more than 10% to $36.8 billion while adjusted EPS increased to $1.28 or 11.5% as compared to the prior year quarter. Continue reading "This Healthcare Juggernaut Continues To Deliver" →

McKesson Delivers Another Steller Quarterly Report

Posted on by Noah Kiedrowski

Noah Kiedrowski - INO.com Contributor - Biotech


Introduction

McKesson Corporation (MCK) reported quarterly results last week and beat on both the top and bottom line while raising guidance and announcing a massive $2 billion share buyback program. The stock responded with a yawn and now sets around $180 per share. MCK presents a compelling investment opportunity in the healthcare space, particularly after the recent sell-off from $243 to $180 per share. This downward movement was flanked by great earnings reports, increased dividend and additional share buybacks. MCK continues to become cheaper and cheaper as each earnings report is announced and the company continues to purchase additional shares. McKesson looks to be undervalued given its growth rate, acquisitive mindset, attractive P/E, dividend and share buyback program. I previously wrote an article outlining my bull case for McKesson and since then the stock has only become cheaper. I feel McKesson is a buy below $200 per share.

McKesson's Blowout Quarterly Results

McKesson reported revenue of $58.8 billion which translates into a 10% increase from the prior fiscal year quarter. On top of this revenue growth, earnings per share increased 19%, cash, and cash equivalents reached $5.2 billion, the company initiated a $2 billion share buyback program and raised guidance from $12.36-$12.86 to $12.50-$13.00 per share. All of these attributes bode well for investors, and now McKesson has a trailing 12 month EPS of $8.26 and with a current price of $179 this translates into a P/E of 21.7. This is an attractive P/E given its shareholder-friendly capital return plan via dividends and share buybacks along with its growth. Continue reading "McKesson Delivers Another Steller Quarterly Report" →

A New Immunotherapy ETF Has Launched

Posted on by Noah Kiedrowski

Noah Kiedrowski - INO.com Contributor - Biotech


Update

I previously wrote an article laying the groundwork for an exciting immunotherapy ETF launching in the second half of 2015, “A Niche ETF In The Potentially Promising Future Of Immunotherapy Is On The Horizon.” Loncar Investments has teamed up with an ETF firm and finally launched its immunotherapy ETF, Loncar Cancer Immunotherapy ETF (ticker symbol: CNRC). I wanted to update readers on the latest information and launch of the ETF as many readers requested.

Introduction

Immunotherapy has emerged as an exciting therapeutic area that has experienced massive growth over the past few years in terms of research and development expenditures and a sheer number of clinical trials throughout the biotechnology sector. Immunotherapy ushers in a new class of potentially promising therapies by leveraging the immune system to recognize and eradicate debilitating diseases, specifically cancer and chronic viral infections. This immunotherapy approach may inevitably result in a paradigm shift from traditional medical intervention. Immunotherapy possesses holistic attributes by harnessing the body’s immune system to contend with the disease. Continue reading "A New Immunotherapy ETF Has Launched" →

The Bruised And Battered Biotech Sector - Buying Opportunity Arises

Posted on by Noah Kiedrowski

Noah Kiedrowski - INO.com Contributor - Biotech


Introduction

The culmination of extraneous events such as sustained lower oil prices, an ostensibly imminent rate hike and weakness in China have indiscriminately plummeted the biotech sector as of late. Now a second and more specific wave of sector related stories such as price gouging by Turing Pharmaceuticals and the subsequent comments by Hillary Clinton have exacerbated this sector decline. These former events are seemingly unrelated to the biotechnology sector, yet this group has been taken along for the downhill ride with the broader indices in lock-step. The latter events have been detrimental to all biotechnology stocks as this is a direct threat to pricing power and our capitalism based structure.

The unprecedented secular growth streak in biotech has been more than tested as of late with biotechnology officially in bear territory. These latest events, some unrelated and others directly related to the biotech sector, may provide a unique opportunity to add to a current position or initiate a position over time as this correction continues to unfold. Based on annual and cumulative performance throughout both bear and bull markets, The iShares Nasdaq Biotechnology (ticker symbol: IBB) may provide the opportunity investors have been waiting for in the face of our current market conditions. IBB is down 25% from its 52-week high, shares have plunged from $400 to $295 per share during the recent market weakness, presenting a potential buying opportunity.

Price gouging and Hilary Clinton

Recently, Turing Pharmaceuticals and its CEO Martin Shkreli garnered criticism after the company boosted the price of Daraprim from $13.50 to $750 per pill, resulting in a greater than 5,400% increase after acquiring the drug in August. This price gouging of a decades’ old drug drew fire from the general public on social media and, in particular, the presidential candidate and Democratic front-runner Hillary Clinton (Figure 1).

Tweet by presidential candidate and Democratic front-runner Hillary Clinton
Figure 1 – Tweet by presidential candidate and Democratic front-runner, Hillary Clinton, referring to the drug price gouging

This price gouging incident has elicited widespread backlash, and in my opinion rightfully so, however this criticism has been unfairly painted across the entire sector. It’s noteworthy to point out that Democratic lawmakers have requested pricing policies and further information on pricing of drugs by Canadian drug maker Valeant Pharmaceuticals. Despite the public backlash and public statements by lawmakers, I believe this is a temporary headwind rooted in the public relations arena. Continue reading "The Bruised And Battered Biotech Sector - Buying Opportunity Arises" →

McKesson Corporation Presents A Compelling Investment Opportunity

Posted on by Noah Kiedrowski

Noah Kiedrowski - INO.com Contributor - Biotech


Introduction

McKesson Corporation (MCK) presents a compelling investment opportunity in the healthcare space, particularly after the recent sell-off from $243 to below $200 per share. In brief, McKesson Corporation delivers pharmaceuticals, medical supplies and healthcare information technology. The Company operates in two segments. The McKesson Distribution Solutions segment distributes drugs, equipment and health and beauty care products domestically and internationally. This segment provides pharmaceutical solutions for biotech and pharmaceutical manufacturers, and practice management, technology, clinical support and business solutions to oncology and other specialty practices operating in the community setting. The McKesson Technology Solutions segment includes McKesson Health Solutions, which includes clinical solutions, claims payment solutions and network performance tools. This segment delivers enterprise-wide clinical, patient care, financial, supply chain, strategic management software solutions, as well as connectivity, outsourcing and other services.

McKesson is driving growth via acquisitions and partnerships

MCK recently acquired the pharmaceutical distribution division of UDG Healthcare plc for €408 million in cash. This acquisition will add a leader in pharmaceutical distribution across the Republic of Ireland and Northern Ireland to McKesson's European business. Marc Owen, Chairman of the Management Board at Celesio AG, said: "The acquisition of UDG's pharmaceutical distribution, home and travel healthcare businesses in Ireland and the UK, will strengthen our position in the industry. We have made this investment as part of our growth strategy which leverages the positive trajectory of the wider healthcare sector in Europe. This acquisition will also complement our broader portfolio of assets in both Ireland and the United Kingdom. We look forward to continuing UDG's tradition of excellent customer service and to working with the UDG team." Continue reading "McKesson Corporation Presents A Compelling Investment Opportunity" →