Gilead shares fall on 2Q report, growth concerns

The stock fell $4.25, or 7.7 percent, to $51.15 in morning trading. Shares have traded between $35.22 and $56.95 over the last 52 weeks.

Late Thursday, the company said it earned 46 cents per share on a 22 percent boost in revenue to $1.28 billion. Most analysts considered the results weak for a company that normally beats expectations.

Also, sales of the company's three-in-one combination HIV drug Atripla narrowly missed estimates.

"With a top line now well over $4 billion, Gilead faces the auspicious challenge of trying to grow off a much larger base," wrote Robert W. Baird analyst Thomas Russo in a note to investors.

He reaffirmed a "Neutral" rating, as he said investors are grappling with the company's first "earnings-per-share miss in years." The company still has plenty of growth potential, he added, but investors seem to expect a tapering off as Gilead's treatments saturate the market. He maintained a $57 price target.

Several analysts downgraded the stock, but acknowledged Gilead's place as one of the top performing companies in the biotech sector.

BMO Capital Markets analyst Jason Zhang lowered his rating to "Market Perform" from "Outperform" citing the value of the shares, flattening HIV drug sales, and increased spending on research and development.

"We recognize that there are several positive catalysts ahead, such as the imminent approval of Viread for hepatitis B and aztreonam lysine for cystic fibrosis, and still consider Gilead's management as one of the best in the industry," he said.

However, he added there are better near-term growth opportunities within the sector.