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

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Vertex Pharmaceuticals (VRTX - Free Report) closed at $188.30 in the latest trading session, marking a +0.64% move from the prior day. This move outpaced the S&P 500's daily loss of 0.91%.

Prior to today's trading, shares of the drugmaker had lost 4.07% over the past month. This has lagged the Medical sector's loss of 0.52% and the S&P 500's gain of 0.01% 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 $3.08, up 16.67% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.84 billion, up 19.31% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $12.37 per share and revenue of $7.25 billion, which would represent changes of +19.86% and +16.81%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for VRTX. These revisions help to show the ever-changing nature of 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.

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 currently a Zacks Rank #2 (Buy).

Looking at its valuation, VRTX is holding a Forward P/E ratio of 15.13. This valuation marks a discount compared to its industry's average Forward P/E of 26.75.

Investors should also note that VRTX has a PEG ratio of 1.54 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Medical - Biomedical and Genetics stocks are, on average, holding a PEG ratio of 1.54 based on yesterday's closing prices.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 195, putting it in the bottom 24% 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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