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Vertex Pharmaceuticals (VRTX) Gains But Lags Market: What You Should Know

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Vertex Pharmaceuticals (VRTX - Free Report) closed the most recent trading day at $215.15, moving +0.4% from the previous trading session. This move lagged the S&P 500's daily gain of 1.04%. At the same time, the Dow added 0.58%, and the tech-heavy Nasdaq gained 2.52%.

Heading into today, shares of the drugmaker had gained 0.83% over the past month, outpacing the Medical sector's loss of 5.72% and the S&P 500's loss of 0.15% in that time.

Wall Street will be looking for positivity from VRTX as it approaches its next earnings report date. The company is expected to report EPS of $2.74, up 7.03% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.66 billion, up 9.49% from the year-ago period.

VRTX's full-year Zacks Consensus Estimates are calling for earnings of $11.26 per share and revenue of $6.87 billion. These results would represent year-over-year changes of +9.11% and +10.68%, respectively.

Investors should also note any recent changes to analyst estimates for VRTX. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. VRTX is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that VRTX has a Forward P/E ratio of 19.03 right now. This represents a discount compared to its industry's average Forward P/E of 24.66.

Also, we should mention that VRTX has a PEG ratio of 1.66. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Medical - Biomedical and Genetics was holding an average PEG ratio of 1.36 at yesterday's closing price.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 191, which puts it in the bottom 26% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow VRTX in the coming trading sessions, be sure to utilize Zacks.com.


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