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The Zacks Analyst Blog Highlights: Gilead Sciences, Abbott Labs, Alliance Data Systems Corporation, Blue Nile and Bristol-Myers Squibb

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For Immediate Release

Chicago, IL – May 15, 2012 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Gilead Sciences (GILD - Free Report) , Abbott Labs ((ABT - Free Report) ), Alliance Data Systems Corporation (ADS - Free Report) , Blue Nile and Bristol-Myers Squibb ((BMY - Free Report) ).

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Here are highlights from Monday’s Analyst Blog:

Good News for Gilead


Gilead Sciences (GILD - Free Report) received some encouraging news recently when an advisory panel of the U.S. Food and Drug Administration (FDA) recommended the approval of the company’s HIV combination pill Quad. A final decision from the FDA regarding the matter is expected by August 27, 2012 (target date).

We note that the Quad pill is a combination of elvitegravir, cobicistat and Truvada. Gilead is looking to get the pill (once daily) approved as a first-line therapy for treating adults infected with the HIV virus.

The FDA’s advisory panel met to review the new drug application (NDA) submitted by Gilead in October 2011 for getting Quad approved in the U.S. The NDA included positive data from two late-stage studies - 102 which compared Quad to Atripla and 103 which compared Quad to Norvir (ritonavir)-boosted Reyataz plus Truvada. While Norvir is marketed by Abbott Labs ((ABT - Free Report) ), Reyataz is marketed by Bristol-Myers Squibb ((BMY - Free Report) ).

While reviewing the application, the panel voted overwhelmingly (13-1) in favor of clearing the combination pill (a single tablet regimen) in the U.S. Even though the U.S. agency is not bound to follow the advice of its advisory committee, the recommendation of the panel is usually considered by the agency while deciding the fate of a candidate.

Positive news from the FDA in August would further boost the top line at Gilead and strengthen its already established HIV portfolio. The Quad pill is also under review in the E.U, Australia and Canada. Approval in additional territories would increase the drug’s sales potential.

Neutral on Gilead

We have a Neutral recommendation on Gilead. Our long-term stance is in line with the Zacks #3 Rank (Hold rating) carried by the company in the short run. We remain optimistic on the growth prospects of Gilead's HIV drugs, Truvada and Atripla. We are also encouraged by the approval of Complera/Eviplera, which together with Quad, once approved, will further fortify the HIV franchise and help mitigate the impact of the upcoming patent expirations.

Gilead is looking to combat the threat of genericization by inking deals and making acquisitions and introducing new products. To further strengthen its hepatitis C virus (HCV) portfolio, Gilead purchased Pharmasset in January 2012, for approximately $11.1 billion.

ADS-Blue Nile Ink Long-Term Deal


Alliance Data Systems Corporation (ADS - Free Report) inked a long-term agreement with Blue Nile in order to initiate and control a new private label credit card program for the latter. Seattle-based Blue Nile is the leading online retailer of diamonds and fine jewelry.

The card program will encompass customized financing options and online account management without charging any annual card fee. The program enables customers to choose from financial options including 6 and 12 months which would ultimately be equivalent to the cash payment that the customers had to pay. On the other hand, customers have the ease to make payments over a period of 24 or 48 months.

Alliance Data will also partner Blue Nile in bringing added incentives for cardholders and marketing initiatives through advanced analytics capabilities, direct mail and email, web and mobile channels.

In the first quarter of 2012, the Private Label Services and Credit segment revenue registered a 7% growth. We expect this transaction to help the company generate additional revenue as well as help the segment to continue delivering robust growth going forward.

Alliance Data posted strong first quarter results with operating earnings substantially ahead of the Zacks Consensus Estimate and year-ago earnings. The strong results came on the back of solid performances across all segments.

The quantitative Zacks #2 Rank (short-term Hold rating) for the company indicates no clear directional pressure on the stock over the near term.


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