Critical Comparison: Vertex Pharmaceuticals (VRTX) and Its Peers
Vertex Pharmaceuticals (NASDAQ: VRTX) is one of 286 publicly-traded companies in the “Bio Therapeutic Drugs” industry, but how does it weigh in compared to its peers? We will compare Vertex Pharmaceuticals to similar companies based on the strength of its risk, institutional ownership, valuation, analyst recommendations, dividends, profitability and earnings.
Insider and Institutional Ownership
93.1% of Vertex Pharmaceuticals shares are owned by institutional investors. Comparatively, 49.9% of shares of all “Bio Therapeutic Drugs” companies are owned by institutional investors. 1.8% of Vertex Pharmaceuticals shares are owned by insiders. Comparatively, 16.9% of shares of all “Bio Therapeutic Drugs” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares Vertex Pharmaceuticals and its peers top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Net Income||Price/Earnings Ratio|
|Vertex Pharmaceuticals||$1.70 billion||-$112.05 million||192.27|
|Vertex Pharmaceuticals Competitors||$284.49 million||$34.10 million||80.23|
Vertex Pharmaceuticals has higher revenue, but lower earnings than its peers. Vertex Pharmaceuticals is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.
This table compares Vertex Pharmaceuticals and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Vertex Pharmaceuticals Competitors||-5,310.77%||-218.27%||-39.48%|
This is a summary of recent ratings for Vertex Pharmaceuticals and its peers, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Vertex Pharmaceuticals Competitors||882||3263||11754||235||2.70|
Vertex Pharmaceuticals currently has a consensus target price of $172.83, suggesting a potential upside of 15.25%. As a group, “Bio Therapeutic Drugs” companies have a potential upside of 44.11%. Given Vertex Pharmaceuticals’ peers higher probable upside, analysts clearly believe Vertex Pharmaceuticals has less favorable growth aspects than its peers.
Risk and Volatility
Vertex Pharmaceuticals has a beta of 1.58, suggesting that its stock price is 58% more volatile than the S&P 500. Comparatively, Vertex Pharmaceuticals’ peers have a beta of 6.07, suggesting that their average stock price is 507% more volatile than the S&P 500.
Vertex Pharmaceuticals beats its peers on 8 of the 13 factors compared.
Vertex Pharmaceuticals Company Profile
Vertex Pharmaceuticals Incorporated is engaged in discovering, developing, manufacturing and commercializing medicines for serious diseases. The Company is focused on developing and commercializing therapies for the treatment of cystic fibrosis (CF) and advancing its research and development programs in other indications. The Company’s marketed medicines are ORKAMBI and KALYDECO. ORKAMBI (lumacaftor in combination with ivacaftor) is approved as a treatment for patients having two copies (homozygous) of the Delta-F508 (F508del) mutation in their cystic fibrosis transmembrane conductance regulator (CFTR) gene. KALYDECO (ivacaftor) is approved for the treatment of CF patients having the G551D mutation or other specified mutations in their CFTR gene. The Company’s development programs in the field of CF include Tezacaftor (VX-661), VX-152, VX-440, VX-659, VX-445 and VX-371. VX-152, VX-440, VX-659 and VX-445 are CFTR corrector compounds.
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