MeritValue

GILEAD SCIENCES, INC.

GILDdata completeness 100%19 fiscal years on file
The thesis, from the filings

GILEAD SCIENCES, INC. earns about 8% on invested capital, below its ~9% cost of capital, with a roughly flat share count — no moat visible in the numbers. The estimate methods put fair value between $46.78 and $101.18 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$27.3B1$27.3B2$27.1B3$28.8B3$29.4B3
Net income$6.23B4$4.59B5$5.67B6$480M6$8.51B6
Operating cash flow$11.4B7$9.07B8$8.01B9$10.8B9$10B9
Capital expenditure$579M10$728M11$585M12$523M12$563M12
Free cash flow (derived)$10.8B7$8.34B8$7.42B9$10.3B9$9.46B9
Total debt$54.9B13$52.7B14$51.8B15$55.2B16$52.7B16
Cash & equivalents$5.34B17$5.41B17$6.09B18$9.99B18$7.56B18
Diluted shares1.26B1.26B1.26B1.25B1.25B

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$180.9
your share of equity
Profit it earned you last year
$67.81
Free cash flow it threw off
$75.35
Debt you’d be carrying
$419.76

10 shares is a claim on $180.9 of net worth that earned you $67.81 and generated $75.35 of cash last year, against $419.76 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
8% avg · 5y
FY21 10%FY22 8%FY23 9%FY24 1%FY25 13%

It earned about 8% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−1% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback. Total debt has held roughly steady.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $46.78 and $101.18 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$101.18
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth4.3%
  • fcfBase$9.46B
DCF · Growth Exit 5Y
$93.59
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth4.3%
  • fcfBase$9.46B
Earnings Power Value
$46.78
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$5.67B
  • growthAssumed0.0%
Graham Number
$52.53
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years4.3%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $93.59
The three cases
Bear0.0%$71.7
Base4.3%$93.59
Bull9.3%$123.96

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 4.3%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000882095-24-000007 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000882095-25-000006 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0000882095-26-000006 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000882095-24-000007 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000882095-25-000006 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000882095-26-000006 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000882095-24-000007 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000882095-25-000006 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000882095-26-000006 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000882095-24-000007 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000882095-25-000006 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0000882095-26-000006 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000882095-23-000007 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0000882095-24-000007 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0000882095-25-000006 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0000882095-26-000006 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0000882095-23-000007 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2023-12-31 · accession 0000882095-26-000006 (CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents)