Vertex Pharmaceuticals (VRTX) Gains But Lags Market: What You Should Know
Vertex Pharmaceuticals (VRTX) closed the most recent trading day at $295.11, moving +0.44% from the previous trading session. This move lagged the S&P 500's daily gain of 0.91%. At the same time, the Dow added 0.85%, and the tech-heavy Nasdaq gained 0.59%.
Heading into today, shares of the drugmaker had gained 7.33% over the past month, outpacing the Medical sector's gain of 4.84% and the S&P 500's gain of 5.26% in that time.
Investors will be hoping for strength from VRTX as it approaches its next earnings release. On that day, VRTX is projected to report earnings of $2.13 per share, which would represent year-over-year growth of 69.05%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.41 billion, up 49.31% from the year-ago period.
VRTX's full-year Zacks Consensus Estimates are calling for earnings of $8.89 per share and revenue of $5.73 billion. These results would represent year-over-year changes of +66.79% and +37.75%, respectively.
Any recent changes to analyst estimates for VRTX should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.85% lower. VRTX currently has a Zacks Rank of #4 (Sell).
Investors should also note VRTX's current valuation metrics, including its Forward P/E ratio of 33.05. Its industry sports an average Forward P/E of 28.43, so we one might conclude that VRTX is trading at a premium comparatively.
It is also worth noting that VRTX currently has a PEG ratio of 1.17. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Medical - Biomedical and Genetics stocks are, on average, holding a PEG ratio of 1.75 based on yesterday's closing prices.
The Medical - Biomedical and Genetics industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 80, which puts it in the top 32% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.