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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 $269.96, marking a +0.49% move from the previous day. The stock outpaced the S&P 500's daily loss of 1.26%. Elsewhere, the Dow lost 0.8%, while the tech-heavy Nasdaq lost 0.44%.

Heading into today, shares of the drugmaker had gained 14.05% over the past month, outpacing the Medical sector's gain of 4.88% and the S&P 500's gain of 6.07% in that time.

Vertex Pharmaceuticals will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $3.59, up 20.47% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $2.08 billion, up 20.69% from the year-ago period.

VRTX's full-year Zacks Consensus Estimates are calling for earnings of $14.58 per share and revenue of $8.55 billion. These results would represent year-over-year changes of +11.98% and +12.93%, respectively.

Investors might also notice recent changes to analyst estimates for Vertex Pharmaceuticals. 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. 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.

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. Over the past month, the Zacks Consensus EPS estimate has moved 0.51% higher. Vertex Pharmaceuticals currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Vertex Pharmaceuticals has a Forward P/E ratio of 18.42 right now. This valuation marks a discount compared to its industry's average Forward P/E of 23.91.

Also, we should mention that VRTX has a PEG ratio of 1.18. 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. The Medical - Biomedical and Genetics was holding an average PEG ratio of 1.22 at yesterday's closing price.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 161, which puts it in the bottom 37% 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.

To follow VRTX in the coming trading sessions, be sure to utilize Zacks.com.


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