Ideas from Jim Cramer’s Stop Trading segment on CNBC:
Gilead Has The Cure
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Shares of Gilead (GILD) have risen 35% so far this year, but the stock may still be worth buying, because Gilead’s Sovaldi is not just another Hepatitis C treatment; it is a cure.
The U.K’s National Institute for Health Care and Excellence recommended reimubrsement for the drug from the National Health Service. The 12-week treatment will cost the British taxpayer 35, 000 pounds or $58, 380, but Sovaldi is designed the cure the disease, not just ease the symptoms. Cramer thinks insurers in the U.S. will also be willing to provide reimbursement for Sovaldi.
Gilead, along with Celgene (CELG) has been a “leading” stock, and in spite of its substantial gains, it has a low multiple of 10.
How Do You Take Your Coffee?
A Barclays analyst recommended buying Dunkin’ Brands (DNKN) on its weakness following earnings, but Cramer thought DNKN’s quarter was “bad.” He prefers best-of-breed Starbucks (SBUX) which reported good earnings amid a bearish time for retail and restaurant stocks. SBUX is the one to buy on weakness, because the stock was unfairly punished.