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

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In the latest trading session, Vertex Pharmaceuticals (VRTX - Free Report) closed at $302.02, marking a +0.46% move from the previous day. This change outpaced the S&P 500's 0.2% loss on the day. Meanwhile, the Dow lost 0.14%, and the Nasdaq, a tech-heavy index, lost 0.12%.

Prior to today's trading, shares of the drugmaker had gained 7.69% over the past month. This has outpaced the Medical sector's loss of 0.3% and the S&P 500's loss of 3.29% in that time.

Wall Street will be looking for positivity from Vertex Pharmaceuticals as it approaches its next earnings report date. The company is expected to report EPS of $3.68, up 3.37% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.22 billion, up 12.1% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $14.21 per share and revenue of $8.77 billion, which would represent changes of +9.14% and +15.8%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Vertex Pharmaceuticals. 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.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Vertex Pharmaceuticals is holding a Zacks Rank of #2 (Buy) right now.

In terms of valuation, Vertex Pharmaceuticals is currently trading at a Forward P/E ratio of 21.16. Its industry sports an average Forward P/E of 18.95, so we one might conclude that Vertex Pharmaceuticals is trading at a premium comparatively.

We can also see that VRTX currently has a PEG ratio of 1.9. 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. VRTX's industry had an average PEG ratio of 1.39 as of yesterday's close.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 61, putting it in the top 25% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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