Vertex Pharmaceuticals (VRTX) shares soared 8.3% in the last trading session to close at $499.17. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 2.1% loss over the past four weeks.
The stock rallied after the company announced positive data from an interim analysis of the ongoing phase III RAINER study, which evaluated its investigational drug povetacicept for IgA nephropathy (IgAN), a rare progressive kidney disease. At the interim analysis, the RAINER study achieved its primary endpoint — treatment with the drug for 36 weeks achieved a 52% reduction from baseline in proteinuria (protein in the urine). High levels of protein in urine tend to indicate that the kidneys are not filtering properly. Treatment with the drug outperformed placebo by 49.8%. Treatment with the drug was safe and well-tolerated in study participants. The RAINER study achieved all its secondary endpoints.
This drugmaker is expected to post quarterly earnings of $4.47 per share in its upcoming report, which represents a year-over-year change of +10.1%. Revenues are expected to be $3.05 billion, up 10.1% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Vertex, the consensus EPS estimate for the quarter has been revised 4.5% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on VRTX going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Vertex is a member of the Zacks Medical - Biomedical and Genetics industry. One other stock in the same industry, Stoke Therapeutics, Inc. (STOK), finished the last trading session 0.1% higher at $38.35. STOK has returned 19.8% over the past month.
Stoke Therapeutics' consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.75. Compared to the company's year-ago EPS, this represents a change of -316.7%. Stoke Therapeutics currently boasts a Zacks Rank of #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
