NasdaqGS:VRTX

Stock Analysis Report

Executive Summary

Vertex Pharmaceuticals Incorporated engages in developing and commercializing therapies for treating cystic fibrosis.

Snowflake

Fundamentals

Flawless balance sheet with solid track record.


Similar Companies

Share Price & News

How has Vertex Pharmaceuticals's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.2%

VRTX

0.8%

US Biotechs

1.0%

US Market


1 Year Return

-2.9%

VRTX

-8.3%

US Biotechs

6.7%

US Market

Return vs Industry: VRTX exceeded the US Biotechs industry which returned -8.3% over the past year.

Return vs Market: VRTX underperformed the US Market which returned 6.7% over the past year.


Share holder returns

VRTXIndustryMarket
7 Day0.2%0.8%1.0%
30 Day-1.4%-3.9%-1.8%
90 Day-2.1%-3.5%-1.8%
1 Year-2.9%-2.9%-7.5%-8.3%9.1%6.7%
3 Year114.2%114.2%13.6%9.6%46.1%36.6%
5 Year64.6%64.6%3.3%-1.7%66.9%48.6%

Price Volatility Vs. Market

How volatile is Vertex Pharmaceuticals's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Vertex Pharmaceuticals undervalued based on future cash flows and its price relative to the stock market?

16%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Undervalued: VRTX ($172.41) is trading below our estimate of fair value ($206.39)

Significantly Undervalued: VRTX is trading below fair value, but not by a significant amount.


Price Based on Earnings

PE vs Industry: VRTX is poor value based on its PE Ratio (19.9x) compared to the Biotechs industry average (17.2x).

PE vs Market: VRTX is poor value based on its PE Ratio (19.9x) compared to the US market (17.5x).


Price Based on Expected Growth

Low PEG Ratio: VRTX is good value based on its PEG Ratio (0.7x)


Price Based on Value of Assets

PB vs Industry: VRTX is overvalued based on its PB Ratio (8.7x) compared to the US Biotechs industry average (2.5x).


Next Steps

Future Growth

How is Vertex Pharmaceuticals expected to perform in the next 1 to 3 years based on estimates from 18 analysts?

27.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: VRTX's forecast earnings growth (27.4% per year) is above the savings rate (2.7%).

Earnings vs Market: VRTX's earnings (27.4% per year) are forecast to grow faster than the US market (14.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: VRTX's revenue (17.8% per year) is forecast to grow faster than the US market (7.3% per year).

High Growth Revenue: VRTX's revenue (17.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: VRTX's Return on Equity is forecast to be high in 3 years time (26.9%)


Next Steps

Past Performance

How has Vertex Pharmaceuticals performed over the past 5 years?

78.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: VRTX has become profitable over the past 5 years, growing earnings by 78.6% per year.

Accelerating Growth: VRTX's earnings growth over the past year (433.4%) exceeds its 5-year average (78.6% per year).

Earnings vs Industry: VRTX earnings growth over the past year (433.4%) exceeded the Biotechs industry 78.4%.


Return on Equity

High ROE: VRTX's Return on Equity (43.2%) is considered outstanding.


Return on Assets

ROA vs Industry: VRTX has a higher Return on Assets than the Biotechs industry average last year.


Return on Capital Employed

ROCE Improving: VRTX's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Vertex Pharmaceuticals's financial position?


Financial Position Analysis

Short Term Liabilities: VRTX's short term assets ($4.7B) exceeds its short term liabilities ($1.3B)

Long Term Liabilities: VRTX's short term assets (4.7B) exceeds its long term liabilities (704.3M)


Debt to Equity History and Analysis

Debt Level: VRTX is debt free.

Reducing Debt: VRTX has no debt compared to 5 years ago when its debt to equity ratio was 0.3%.

Debt Coverage: VRTX has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: VRTX has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: VRTX has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if VRTX's debt is covered by short term assets.


Next Steps

Dividend

What is Vertex Pharmaceuticals's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.5%markettop25%3.8%industryaverage1.0%forecastin3Years0%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: Unable to evaluate VRTX's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate VRTX's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if VRTX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if VRTX's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of VRTX's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Vertex Pharmaceuticals's salary, the management and board of directors tenure and is there insider trading?

2.8yrs

Average management tenure


CEO

Jeff Leiden (63yo)

7.7yrs

Tenure

US$18,799,147

Compensation

Dr. Jeffrey Marc Leiden, also known as Jeff, M.D., Ph.D. has been the Chairman of Vertex Pharmaceuticals Incorporated since May 2012 and has been its Chief Executive Officer and has also been President sin ...


CEO Compensation Analysis

Compensation vs. Market: Jeff's total compensation ($USD18.80M) is about average for companies of similar size in the US market ($USD11.20M).

Compensation vs Earnings: Jeff's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.8yrs

Average Tenure

52yo

Average Age

Experienced Management: VRTX's management team is considered experienced (2.8 years average tenure).


Board Age and Tenure

6.3yrs

Average Tenure

60yo

Average Age

Experienced Board: VRTX's board of directors are considered experienced (6.3 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$641,21806 Feb 19
Paul Silva
EntityIndividual
Shares3,438
Max PriceUS$188.33

Ownership Breakdown


Management Team

  • Jeff Leiden (63yo)

    Chairman

    • Tenure: 7.7yrs
    • Compensation: US$18.80m
  • Charlie Wagner (51yo)

    Executive VP & CFO

    • Tenure: 0.5yrs
  • Michael Partridge

    Senior Vice President of Investor Relations

    • Tenure: 0yrs
  • Amit Sachdev (51yo)

    Executive VP & Chief Regulatory Officer

    • Tenure: 12.3yrs
    • Compensation: US$5.68m
  • David Altshuler (54yo)

    Executive VP of Global Research & Chief Scientific Officer

    • Tenure: 4.8yrs
    • Compensation: US$5.73m
  • Damian Wilmot (43yo)

    Senior VP

    • Tenure: 2.8yrs
  • Stuart Arbuckle (53yo)

    Executive VP & Chief Commercial Officer

    • Tenure: 7.1yrs
    • Compensation: US$5.35m
  • Jeff Chodakewitz (63yo)

    Senior Advisor

    • Tenure: 1.5yrs
    • Compensation: US$5.70m
  • Michael Parini (44yo)

    Executive VP and Chief Legal & Administrative Officer

    • Tenure: 2.8yrs
    • Compensation: US$5.37m
  • Nina Devlin

    Senior VP & Chief Communications Officer

    • Tenure: 0.8yrs

Board Members

  • Bruce Sachs (59yo)

    Lead Independent Director

    • Tenure: 0yrs
    • Compensation: US$655.32k
  • Bill Young (74yo)

    Independent Director

    • Tenure: 5.4yrs
    • Compensation: US$597.82k
  • Jeff Leiden (63yo)

    Chairman

    • Tenure: 7.7yrs
    • Compensation: US$18.80m
  • Yuchun Lee (54yo)

    Independent Director

    • Tenure: 7.1yrs
    • Compensation: US$600.32k
  • Margie McGlynn (60yo)

    Independent Director

    • Tenure: 8.4yrs
    • Compensation: US$595.32k
  • Terry Kearney (64yo)

    Independent Director

    • Tenure: 8.4yrs
    • Compensation: US$617.82k
  • Alan Garber (63yo)

    Independent Director

    • Tenure: 2.3yrs
    • Compensation: US$585.32k
  • Lloyd Carney (57yo)

    Independent Director

    • Tenure: 0.7yrs
  • Sangeeta Bhatia (50yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: US$605.32k

Company Information

Vertex Pharmaceuticals Incorporated's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Vertex Pharmaceuticals Incorporated
  • Ticker: VRTX
  • Exchange: NasdaqGS
  • Founded: 1989
  • Industry: Biotechnology
  • Sector: Pharmaceuticals & Biotech
  • Market Cap: US$44.315b
  • Shares outstanding: 257.04m
  • Website: https://www.vrtx.com

Number of Employees


Location

  • Vertex Pharmaceuticals Incorporated
  • 50 Northern Avenue
  • Boston
  • Massachusetts
  • 2210
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
VRTXNasdaqGS (Nasdaq Global Select)YesCommon SharesUSUSDJul 1991
VX1DB (Deutsche Boerse AG)YesCommon SharesDEEURJul 1991
VRTX *BMV (Bolsa Mexicana de Valores)YesCommon SharesMXMXNJul 1991
VRTXSWX (SIX Swiss Exchange)YesCommon SharesCHCHFJul 1991
0QZULSE (London Stock Exchange)YesCommon SharesGBUSDJul 1991
VRTXWBAG (Wiener Boerse AG)YesCommon SharesATEURJul 1991
VRTX34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REP 0.25 COM USD0.01BRBRLMay 2019

Biography

Vertex Pharmaceuticals Incorporated engages in developing and commercializing therapies for treating cystic fibrosis. The company markets SYMDEKO/SYMKEVI, ORKAMBI, and KALYDECO to treat patients with cysti ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 01:30
End of Day Share Price2019/10/11 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.

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