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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 at $185.49 in the latest trading session, marking a +0.04% move from the prior day. This move lagged the S&P 500's daily gain of 0.37%.

Coming into today, shares of the drugmaker had lost 0.21% in the past month. In that same time, the Medical sector lost 4.25%, while the S&P 500 gained 2.13%.

VRTX will be looking to display strength as it nears its next earnings release. In that report, analysts expect VRTX to post earnings of $3.12 per share. This would mark year-over-year growth of 18.18%. Meanwhile, our latest consensus estimate is calling for revenue of $1.85 billion, up 20.31% from the prior-year quarter.

VRTX's full-year Zacks Consensus Estimates are calling for earnings of $12.43 per share and revenue of $7.29 billion. These results would represent year-over-year changes of +20.45% and +17.44%, respectively.

Investors should also note any recent changes to analyst estimates for VRTX. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 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. The Zacks Consensus EPS estimate has moved 0.86% higher within the past month. VRTX is currently sporting a Zacks Rank of #2 (Buy).

Digging into valuation, VRTX currently has a Forward P/E ratio of 14.91. Its industry sports an average Forward P/E of 24.64, so we one might conclude that VRTX is trading at a discount comparatively.

We can also see that VRTX currently has a PEG ratio of 1.53. 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 1.53 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 179, which puts it in the bottom 30% 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.

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


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