Gilead Sciences released its latest earnings report after the market close, showing earnings of $2.43 per share on $7.31 billion in revenue, a huge year over year increase. Despite these encouraging results, GILD is down over 4% at pixel time.
The biotech industry has been on a tear over the last few years. IBB, a bell-weather ETF that tracks the sector, has more than doubled since the beginning of 2013. The top 10 holdings of IBB have all had amazing runs:
As the heatmap below shows, the correlation structure of the sector is dominated by IBB. There is a tight sub-cluster formed by BIIB, GILD, CELG, AMGN, and REGN.
With GILD getting slammed after releasing its earnings, it will be interesting to see what effect this will exert on other stocks in the sector. Gilead has been most correlated with Celgene.