BMY/Nick - It's a nice drop but BMY is still very aggressively valued at $98Bn with just $16Bn in sales and $2Bn in profits. There's no real sign that those numbers are going to change significantly, so it's certainly not a stock I'd get into. I think the run up to $70 was simply this stock following the sector to the moon - but it doesn't mean $58 is any kind of bargain.
GILD is my favorite Pharma, with a $156Bn valuation backed up by $25Bn in sales (66% more than BMY) but justified with a whopping $12Bn in profits (500% more) that appear to be holding up very well. Unless you have some amazingly compelling reason to buy BMY for 50x earnings, I'd suggest buying GILD for 13x earnings.
We don't have GILD in the LTP and it's been a day since we collected more cash for promising to buy something cheap, so how about we sell 5 of the 2017 $80 puts for $6 and get paid $3,000 to keep GILD on our closely-watched list of stocks.
You could add to that, the 2017 $95 ($21.50) /110 ($13.90) bull call spread at $7.60 and net into the $15 spread that's $11.40 in the money for $1.60 but I'd rather just take it easy for now and buy more if things get cheaper. If they don't get cheaper - then we'll "only" get $3,000 - just for thinking about them.
Oil inventories are a VERY DISAPPOINTING build - much like API indicated.
- EIA Petroleum Inventories:
- Crude +2.6M barrels vs. +0.9M consensus, +4.7M last week.
- Gasoline +0.4M barrels vs. +0.9M consensus, -0.3M last week.
- Distillates +1.0M barrels vs. -0.6M consensus, +0.1M last week.
- Futures +1.7% to $44.92.
Oil at $45.25 now and struggling to hold it.
