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

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In the latest trading session, Vertex Pharmaceuticals (VRTX - Free Report) closed at $200.54, marking a -0.83% move from the previous day. This change lagged the S&P 500's daily gain of 0.75%.

Prior to today's trading, shares of the drugmaker had lost 4.47% over the past month. This has lagged the Medical sector's gain of 5.55% and the S&P 500's gain of 3.52% in that time.

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 $2.69 per share, which would represent year-over-year growth of 3.07%. Meanwhile, our latest consensus estimate is calling for revenue of $1.71 billion, up 12.03% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $11.22 per share and revenue of $6.91 billion, which would represent changes of +8.72% and +11.42%, respectively, from the prior 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.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. The Zacks Consensus EPS estimate remained stagnant within the past month. VRTX is holding a Zacks Rank of #4 (Sell) right now.

Investors should also note VRTX's current valuation metrics, including its Forward P/E ratio of 17.87. This valuation marks a discount compared to its industry's average Forward P/E of 25.44.

Meanwhile, VRTX's PEG ratio is currently 1.51. 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. The Medical - Biomedical and Genetics was holding an average PEG ratio of 1.4 at yesterday's closing price.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 205, putting it in the bottom 20% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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