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Vertex (VRTX) to Report Q3 Earnings: What's in the Cards?

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Vertex Pharmaceuticals Incorporated (VRTX - Free Report) is scheduled to report third-quarter 2021 results on Nov 2, after the market closes.

The company surpassed expectations in three of the trailing four quarters while missed on one occasion, with the average earnings surprise being 7.1%. In the last reported quarter, Vertex delivered an earnings surprise of 15.6%.

Shares of the company have lost 22.1% so far this year compared with the industry’s 9.7% decline.

Let’s see how things are shaping up for the quarter to be reported.

Factors to Consider

Revenue growth in the second quarter was driven by a rapid uptake of the company’s newest cystic fibrosis (“CF”) medicine, Trikafta/Kaftrio (Trikafta’s brand name in Europe). This is most likely to have continued in the third quarter as well.

Vertex secured reimbursement agreements for Kaftrio in more than 15 countries outside the United States, including key markets like Italy and France. It also gained approval for younger patients in the United States, with U.S. approval to treat patients of 6-11 years of age in June. With these approvals, Trikafta/Kaftrio sales are likely to have been higher year over year in the third quarter.

Higher sales of Trikafta caused sales erosion of Vertex’s other CF drugs and existing combinations, namely Kalydeco, Orkambi as well as Symdeko/Symkevi.

Meanwhile, investors expect an update on Vertex’s non-CF pipeline on the third-quarter conference call.

The company has been progressing with the development of the pipeline. Vertex has been developing several candidates using gene-editing/mRNA/cell therapy targeting different indications other than CF like thalassemia, sickle cell disease and diabetes.

Vertex advanced its selective NaV1.8 inhibitor, VX-548, to a phase II study for acute pain (following bunionectomy and in abdominoplasty) in July. While enrollment for the bunionectomy study is open, the same for abdominoplasty will commence soon.

During the quarter under review, the company inked separate collaboration deals with Arbor Biotechnologies and Mammoth Biosciences to develop ex vivo and in vivo engineered cell therapies, respectively, targeting multiple diseases.

Earnings Whispers

Our proven model predicts an earnings beat for Vertex this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. Fortunately, that is the case here as you will see below. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Earnings ESP: The company has an Earnings ESP of +10.62% as the Most Accurate Estimate of $3.45 per share is higher than the Zacks Consensus Estimate of $3.12.

Zacks Rank: Vertex has a Zacks Rank #2.

Other Stocks to Consider

Here are a few other stocks you may want to consider as our model shows that these too have the right combination of elements to beat on earnings this reporting cycle.

Exelixis, Inc. (EXEL - Free Report) has an Earnings ESP of +20.00% and a Zacks Rank #1. The company is scheduled to report quarterly earnings on Nov 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Galera Therapeutics (GRTX - Free Report) has an Earnings ESP of +42.64% and a Zacks Rank #2.

Regeneron (REGN - Free Report) has an Earnings ESP of +8.78% and a Zacks Rank #1. The company is scheduled to report quarterly earnings on Nov 4.

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