Tag Archives: Price
FILE PHOTO: Rows of new Tesla Model 3 electric vehicles are seen in Richmond, California. REUTERS/Stephen Lam/File Photo
(Reuters) – Electric carmaker Tesla Inc is lowering the price of its Model 3 by $ 1,100, citing the end of a costly customer referral program, a company spokeswoman said on Wednesday.
The second price cut to the Model 3 this year now brings the cost of its least expensive variant to $ 42,900, according to the company’s website here.
Tesla’s customer referral incentive plan ended on Feb. 1 after Chief Executive Officer Elon Musk had tweeted that the referral program was “adding too much cost to the cars, especially Model 3”.
Tesla delivered fewer-than-expected Model 3 sedans in the fourth quarter and cut prices for all its vehicles in the United States to offset a reduction in a green tax credit.
The company is rapidly increasing production of its Model 3 sedan and lower prices could help it reach a broader customer base than its pure luxury vehicles.
Reporting by Sanjana Shivdas in Bengaluru; Editing by Gopakumar Warrier
Bitcoin’s value jumped by almost 9% at one point on Monday, as investors fled the so-called stablecoin Tether.
Tether tokens are supposed to be tied to the U.S. dollar, with the eponymous company behind them claiming that it has a dollar in its accounts for each token it issues. There is no conclusive evidence to support this claim, but the token is still often used as a dollar substitute for trading purposes, as they are more easily transferred between exchanges than dollars are.
Some have long suspected that the Tether operation is being used to buy a load of Bitcoins for nothing, effectively propping up the value of Bitcoin. It so happens that Tether and a major cryptocurrency exchange called Bitfinex share the same CEO, and Tether sends all its freshly minted tokens to Bitfinex. When they get there, the price of Bitcoin tends to go up, suggesting Tether tokens are being used to buy Bitcoins.
On Monday, the value of the Tether token, which had been worth around 99 cents, suddenly plunged as low as 93 cents before recovering to around 97 cents. At the same time, Bitcoin’s price shot up by 8.9% to $ 6,769 before settling down to around $ 6,640 at the time of writing—still up 5.2% over the preceding day.
According to Bloomberg, the reason for Tether’s pull away from the $ 1 mark lay in renewed rumors around Bitfinex’s financial health.
Bitfinex said in a Monday Medium post that its customers were still able to withdraw cryptocurrencies and fiat-currency holdings “without the slightest interference,” although “fiat deposits have been temporarily paused for certain user groups” pending the implementation of a new deposit system Tuesday. This missive appears to have been what staunched the selloff.
Bitcoin wasn’t the only winner from the Tether upset. Alternative “stablecoins” such as Gemini Dollar and TrueUSD are also up, as traders pulled back from Tether.
Gilead (GILD) is a biotech company with leading franchises in Hepatitis C, HIV, and emerging platforms in Oncology, Hepatitis B, and NASH. To an extent, Gilead is a victim of its own success. The company’s Hepatitis C (“HCV”) treatments cured the illness and for the last few years the company has seen its revenues fall as patient volumes have decreased. However, the decline of the company’s HCV franchise has masked significant progress the company has made in commercializing its HIV treatments. Furthermore, the company has generated a ton of cash which it has used to acquire companies with strong drug pipelines and engage in a number of clinical trials.
Because of all the investments that Gilead has made in its HIV franchise and in developing its pipeline, the company is strongly positioned for significant growth in new treatments. The HCV business has already declined to such a degree that it will be a much smaller driver of future earnings. This sets the stage for growth in 2019 and beyond. I expect investors to re-rate Gilead with a higher multiple once it returns to growth. Gilead’s current forward EV/EBIT multiple is 8.6x vs. the peer median at over 13x. Gilead could see its stock price rise over 50% in the next 18 months just from a valuation multiple re-rated to be in-line with peers as investors begin to appreciate the company’s new and emerging treatment franchises.
Gilead’s Hepatitis C Struggles
Gilead has had a storied history in the Hepatitis C market. The company entered the market through its $ 11 billion acquisition of Pharmasset which had late-stage clinical trials for its HCV treatments but was still pre-revenue.
Gilead’s Pharmasset acquisition was seen as risky at the time but proved to be very shrewd. By 2014, lead HCV drugs Harvoni and Solvaldi received US FDA approval. By 2015, Gilead’s HCV sales peaked at $ 19.2 billion, outselling all legacy treatments.
Gilead won the HCV market because its treatments were more effective; in fact, Gilead had a cure for the disease. As a result, beginning in 2016, the company saw HCV start to decline because patient volumes were falling due to a lack of repeat business. In addition to declining patient volumes, AbbVie and Merck have released new treatments with effectiveness on-par with Gilead and they have entered the HCV market at lower prices to aggressively take market share.
At its peak, Gilead generated $ 4.9 billion in HCV revenue per quarter. In the most recent Q2 2018 report, Gilead showed HCV revenue of just $ 1.0 billion.
Gilead’s HCV business is expected to continue declining, but the silver lining is that HCV represents a much smaller mix of Gilead’s overall business today than it did a few years ago. In 2016, HCV represented roughly 50% of total sales. In 2018E, HCV is expected to be less than 20% of total sales and HCV’s importance will only decline further in later years (source: SEC disclosures, Author’s estimate).
What’s more is that the HCV declines may be more manageable from here. Future drug price declines and share losses will probably be less acute than what we have seen. At some point the sales will stabilize to some base level and will no longer be a headwind at all. Q2 2018 was actually encouraging in the sense that HCV sales did not significantly drop sequentially between Q1 and Q2, compared to prior quarters.
Gilead Has A World-Leading HIV Franchise
All the drama from Gilead’s HCV business has taken everyone’s attention from Gilead’s blockbuster HIV business. Gilead has top-prescribed HIV drugs in both the US and Europe and is successfully transitioning from its earlier TDF treatments to its newer TAF treatments which are more effective and require patients to ingest fewer pills.
Source: Gilead Q2 investor presentation.
Based on the below table, Gilead has a 79% market share in US HIV treatments.
Source: Gilead Q2 2018 presentation.
Unlike Gilead’s HCV franchise, which was dominated by two drugs, the company has a dozen different HIV treatments, with several still in clinical trials, treating a wider range of variations on the condition. This makes the HIV franchise less reliant on single blockbusters and more durable in the face of competition. Gilead’s HIV business has grown from about $ 9 billion in 2013 sales to $ 13.6 billion in the most recent 12 month period (a roughly 10% annual growth rate). Over the next 10 years, Gilead’s HIV business is expected to grow sales at a mid-single digit annual rate (5% to 7% range).
Estimates for Gilead’s HIV Treatment Growth
Source: RBC Capital Markets.
In recent years, the decline of HCV has masked the significant growth in HIV. Over the next few years, investors will better appreciate the growth as the HCV headwind fades in magnitude.
Gilead Is Developing A Premier Oncology Franchise
Last year Gilead acquired Kite Pharma for $ 11 billion. This transaction was very similar to the Pharmasset acquisition Gilead made in 2011 which jump-started its HCV franchise. Kite was a pre-revenue oncology-focused biotech that is considered a leader in the emerging CAR-T treatment. CAR-T is a treatment which involves modifying a patient’s T-cells to make them more effective at fighting tumors.
The Kite acquisition is already starting to pay-off. In October 2017 (just six weeks after the acquisition was announced), Kite received FDA approval for its first drug, Yescarta. Although Kite isn’t the only biotech working on CAR-T treatments, Yescarta was the second ever FDA approval for a CAR-T treatment and the first FDA approval for diffuse large B-cell lymphoma (“DLBCL”).
Yescarta has generated $ 135 million in revenue since it was approved, $ 68 million of that was in the last quarter, clocking in 70% sequential q/q growth. Yescarta is currently undergoing regulatory review in Europe. Based on the early success of the drug and the large target market, Yescarta is expected to be a multi-billion dollar per year revenue generator by 2025 (source: PiperJaffray research report from May 30, 2018).
In addition to Yescarta, Gilead has several oncology drugs acquired from Kite that are in stage 2 or stage 3 clinical trials. This is an encouraging sign that Gilead is developing a large cancer drug treatment franchise on par with or potentially even bigger than the company’s HIV business.
Gilead Has An Incredibly Robust Drug Pipeline
As shown in the table below, Gilead has a couple dozen ongoing clinical trials at various stages. Some of these trials are in areas such as HIV, Hepatitis C, Hepatitis B, and oncology, where Gilead already has a presence and new drug approvals would be incremental to existing businesses or would simply extend a franchise. However, Gilead also has some exciting clinical trials in totally new drug markets such as NASH, solid cancer tumors, Rheumatoid Arthritis, Crohn’s Disease, and more. Specifically, treatments using the JAK1 inhibitor and related to liver diseases (NASH) and other forms of cancer, could each be multi-billion dollar annual revenue opportunities within the next 10 years.
What Could Gilead’s Stock Be Worth?
Today, Gilead trades for 8.6x EV / Forward EBIT. This compares to a peer median multiple of 14x. The obvious explanation for the discount in Gilead’s multiple is the comparison of its revenue declines vs. peers growing revenue at a double-digit rate on average. In other words, Gilead isn’t a sexy biotech story and has seen its stock price go nowhere for several years. Investors have simply given up on the stock after years of disappointment. However, Gilead is set to start growing again in 2019 and beyond. In fact, Gilead has a very exciting pipeline that could re-shape the entire company within the next few years.
If certain pipeline events fall in line, Gilead’s revenue growth could significantly surprise to the upside. This has the potential to cause a re-rating in Gilead’s traded valuation multiple. If Gilead’s stock were to re-rate in-line with its peers, it could rise by over 50%. Furthermore, unlike many pharma pipeline bets, Gilead has real earnings supported by a thriving HIV business and a rapidly growing oncology business. Gilead’s earnings and its un-levered balance sheet provide solid downside in the event that the pipeline disappoints. Overall, I believe Gilead represents a very attractive risk-reward: little downside with significant potential upside.
Key Investment Risks
Management transition. In the most recent Q2 2018 earnings, the company announced that CEO John Milligan will be stepping down at the end of the year. Additionally, Board Chairman John Martin would also be stepping down. Successors have not yet been named and there is a significant risk that the next crop of leaders will not live up to the former leaders. Both Milligan and Martin are long-tenured executives with the company and their exits were a surprise to investors; however, they are leaving the company in good shape. Also, now that the company is diversifying into other treatment areas, it makes sense to bring in new leaders with broader pharma experience. Investors should keep a close eye on who the company chooses to succeed Milligan and Martin.
Pipeline risk. Gilead’s pipeline presents significant future earnings possibilities, but the pipeline is not guaranteed to produce any major new drugs. To the extent that the ongoing clinical trials disappoint investors, Gilead’s stock price could suffer. However, given the current low valuation multiple placed by investors on the company, I would argue that investors haven’t placed extremely high value on the company’s pipeline. Therefore, to the extent the pipeline does produce exciting new drugs, the stock could significantly rise.
Pharma pricing pressure. Perhaps the biggest unknown in the pharmaceutical space is how the regulatory and industry landscape will evolve. There is significant political pressure from both the Left and the Right to increase regulations over excessively high drug prices. Gilead has a reputation for high-priced drugs and could face reduced pricing power from current and future treatments. Additionally, PBMs and insurance companies are merging and are better positioned to negotiate lower drug prices. We simply do not know how much (or little) the industry’s pricing will change.
Disclosure: I am/we are long GILD.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
STOCKHOLM (Reuters) – Swedish biometrics firm Fingerprint Cards on Monday announced a new round of big cost cuts on the back of weak market conditions for capacitive sensors for smartphones and heavy price pressure.
The company said it expected the new cost cuts to yield savings of 350 million crowns ($ 39.8 million) on an annual basis, with full effect at the end of the fourth quarter.
Fingerprint Cards said it will cut around 179 staff, and the restructuring costs are seen at 65 million crowns, which will mainly be taken in the third quarter.
“We are continuing to adapt our operations to the fundamental and rapid change in business conditions, with the objective of returning to profitable growth,” Fingerprint Cards Chief Executive Christian Fredrikson said in a statement.
“The cost reduction measures we are communicating today are important in order to strengthen our competitiveness,” he added.
The company also said it would make an inventory write-down of around 336 million Swedish crowns and a 143 million crown write-off of capitalized research and development (R&D) projects.
During the first quarter of 2018, Fingerprint Cards implemented another cost reduction program, seen generating cost savings of 360 million crowns this year.
Fingerprint Cards’ shares are down 60 percent so far in 2018 year on the back of rapidly falling sales and earnings.
Reporting by Johannes Hellstrom
Eager to put the Galaxy Note 7 disaster in the rearview, Samsung used 2017 to double down on impressive, feature-packed smartphones. Last year’s Note 8 and S8 handsets both impressed in a big way, bringing edge-to-edge, AMOLED-powered displays into the mainstream long before Apple was able to get the iPhone X to market. Naturally, as the smartphone expo of Mobile World Congress gets going today in Barcelona, Spain, it’s time to welcome the Samsung Galaxy S9.
The new S9 looks almost like last year’s S8, and that’s completely intentional. Both the S9 and S9+ refine the Galaxy’s already mature design. Perhaps the biggest physical change here (besides the addition of a badass Lilac Purple color option) is around the back of the phone, where the fingerprint scanner has been moved to sit just below the camera. This addresses one of the biggest gripes users had with the S8, since it was stupidly easy to smudge up the camera’s glass cover when feeling around for the tiny fingerprint pad.
Two versions of the flagship Sammy phone will be available: a 5.8-inch S9 and a whopping 6.2-inch S9+. All the standard Samsung features have been branded this generation as “Galaxy Foundation,” and no, that’s not a new non-profit charity. This term sums up all the things that make a Galaxy a Galaxy—stuff like IP68 water and dust protection, fast wireless charging, and microSD memory expansion. New in the S9 and S9+ is an enhanced biometric security setting that combines the slower, more secure iris scanner with facial recognition. There’s even a headphone jack, which seems like such a luxury in 2018.
Sure sounds like a Samsung phone, doesn’t it?
The thing Samsung hyped the most when debuting S9’s is its new-and-improved camera. The marquee ability of the S9’s upgraded imaging hardware is a variable-aperture camera. The 12-megapixel, optically-stabilized main cameras of both the S9 and S9+ have two aperture settings thanks to an aperture plate on both phones that slides in place whenever it’s needed. Wide open, the camera gathers more light in dim situations at a fast f/1.5 aperture. When stopped down, it shoots in f/2.4, which is better for brighter environments. The camera’s other major trick is a super slow-motion setting, which leverages an on-sensor data buffer to shoot up to 960 frames per second.
Jumping into the animated, facial-mapped emoji craze, Samsung is introducing AR Emoji. Competing with the iPhone X’s Animoji, AR Emoji gives users a cartoon version of themselves they can use to express a range of emotions and reactions. The animations can be sent via SMS, and you can export a custom animation as a GIF, though Samsung’s take on this is more Nintendo Mii than anything.
Additionally, Samsung has added improvements to DeX, the app that lets you connect the phone to a keyboard and monitor for desktop-like experience. The new phones also get stereo Dolby Atmos-powered speakers, ever-so-slightly narrower bezels, the latest Qualcomm Snapdragon 845 chip, and some new Bixby abilities for good measure.
Preorders for the S9 and S9+ begin Friday, March 2. Retail stores will start carrying the new models on March 16. The S9 will start at $ 719 unlocked, while its larger Plus-sized sibling will go for $ 839.
More WIRED Gear
(Reuters) – Alphabet Inc’s Google is raising the price of its YouTube TV online service for new customers as it adds channels from Time Warner Inc’s Turner, National Basketball League and Major League Baseball, the company said Wednesday.
Less than one year after launching YouTube TV, the company is increasing its pricing to $ 40 per month from $ 35 per month as it adds Turner’s channels, which include TNT, CNN and TBS, and soon will be adding MLB Network and NBA TV, the company said.
Google is expanding its offering at a time when a growing number of competing services, such as Dish Network Corp’s Sling TV, AT&T’s DirecTV Now and Hulu, are vying to win over the growing number of viewers who are cancelling their cable subscriptions to watch their favorite shows online.
The four largest cable and satellite companies lost 1.5 million pay TV customers in 2017.
DirectTV Now has over 2 million subscribers, according to AT&T. Sling TV, Hulu and YouTube TV do not disclose how many users they have, but research firm BTIG estimates they respectively had 2.1 million, 500,000 and 350,000 as of the end of 2017.
The costs for these competing offerings range from $ 20 for Sling TV’s most basic offering of 30 channels to $ 39.99 for Hulu’s one with more than 50 channels and its library of shows and movies, which costs $ 7.99 separately.
Google is betting that its strong sports offering will help win over more subscribers, said Heather Moosnick, director of content partnerships, YouTube TV.
“Sports is really one of the key offerings that a millennial would be willing to pay for a live TV service,” she said.
To that end, Google has targeted sports fans with its TV ads this year. Ninety-six percent of YouTube TV’s ads on television so far this year have appeared during sports programming, including the Super Bowl, according to iSpot.tv, which tracks TV ads.
When Google launched YouTube TV last April it was cautious with how much content it was offering so that it could keep the price low enough to entice cord cutters or people considering cutting the cord, Moosnick said.
At launch YouTube TV offered almost 50 channels in five markets. With these additions, YouTube TV will have almost 60 channels, and be in 100 markets, Moosnick said.
The new pricing will take effect for new users who sign up after March 13, the company said.
Reporting By Jessica Toonkel; Editing by Susan Thomas
Video streaming platform Roku has raised $ 219 million in its Wednesday initial public offering.
Priced at $ 14 a share, the company sold 15.7 million shares from Roku and some of its private shareholders, valuing the company at $ 1.3 billion. The stock will make its debut on the Nasdaq exchange today under the symbol “ROKU.” The IPO was a success for Roku, which had initially proposed a $ 12-14 a share range.
Roku’s boxes allow users to stream content from a variety of video services, including Netflix, YouTube, and HBO. As of June 30, the company has 15.1 million active accounts, with users streaming more than 6.7 billion hours in first half of the year.
While the growing streaming trend has made Roku popular, the company has had largely unprofitable growth since it was founded in 2002. Last year, the company brought in $ 399 million in revenue, but lost $ 43 million. In the first half of this year, it lost $ 24.2 million.
According to TechCrunch, Roku had previously raised more than $ 200 million in capital since 2008. Menlo Ventures was the largest stakeholder prior to the IPO, owning 35.3%, and Fidelity owned 12.9%.
Gaming in VR has a bit of a barrier to entry. Nestled between the phone-based headsets and the high-end experiences is the PlayStation VR, but that’s still $ 399 plus the PlayStation itself. For Oculus or HTC you’re looking at $ 800-plus and a high-end gaming rig that should set you back at least a grand. Oculus today narrowed the margin, if only slightly. The company today announced a price drop on its Rift headset with Touch controllers. The bundle will now sell for $ 598, down from the $ 798 retail price it’s typically listed at. If you already have Rift, you can…
This story continues at The Next Web