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Vertex Pharmaceuticals (VRTX) Outpaces Stock Market Gains: What You Should Know

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Vertex Pharmaceuticals (VRTX - Free Report) closed the most recent trading day at $197.82, moving +1.79% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.23%.

Coming into today, shares of the drugmaker had lost 6.85% in the past month. In that same time, the Medical sector gained 3.46%, while the S&P 500 gained 2.34%.

Wall Street will be looking for positivity from VRTX as it approaches its next earnings report date. On that day, VRTX is projected to report earnings of $2.73 per share, which would represent year-over-year growth of 4.6%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.72 billion, up 12.54% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $11.22 per share and revenue of $6.92 billion. These totals would mark changes of +8.72% and +11.44%, respectively, from last year.

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. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. VRTX is currently a Zacks Rank #3 (Hold).

Looking at its valuation, VRTX is holding a Forward P/E ratio of 17.32. For comparison, its industry has an average Forward P/E of 23.52, which means VRTX is trading at a discount to the group.

Investors should also note that VRTX has a PEG ratio of 1.46 right now. 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 1.47 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 211, which puts it in the bottom 17% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

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


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