VERTEX PHARMACEUTICALS INC (VRTX) Stock Fundamental Analysis
NASDAQ:VRTX - Nasdaq - US92532F1003 - Common Stock - Currency: USD
Overall VRTX gets a fundamental rating of 5 out of 10. We evaluated VRTX against 562 industry peers in the Biotechnology industry. Both the profitability and the financial health of VRTX get a neutral evaluation. Nothing too spectacular is happening here. VRTX has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
VRTX had negative earnings in the past year.
In the past year VRTX has reported a negative cash flow from operations.
VRTX had positive earnings in 4 of the past 5 years.
Of the past 5 years VRTX 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of VRTX (-4.32%) is better than 88.08% of its industry peers.
VRTX has a Return On Equity of -5.99%. This is amongst the best in the industry. VRTX outperforms 89.68% of its industry peers.
VRTX has a better Return On Invested Capital (17.41%) than 96.80% of its industry peers.
The Average Return On Invested Capital over the past 3 years for VRTX is above the industry average of 15.87%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -4.32% | ||
| ROE | -5.99% | ||
| ROIC | 17.41% |
ROA(3y)10.62%
ROA(5y)14.47%
ROE(3y)13.73%
ROE(5y)19.12%
ROIC(3y)19.47%
ROIC(5y)20.15%
1.3 Margins
The Operating Margin of VRTX (37.91%) is better than 98.75% of its industry peers.
In the last couple of years the Operating Margin of VRTX has grown nicely.
Looking at the Gross Margin, with a value of 86.03%, VRTX belongs to the top of the industry, outperforming 88.79% of the companies in the same industry.
VRTX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 37.91% | ||
| PM (TTM) | N/A | ||
| GM | 86.03% |
OM growth 3Y2.79%
OM growth 5Y6.75%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.74%
GM growth 5Y-0.17%
2. Health
2.1 Basic Checks
VRTX has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
VRTX has less shares outstanding than it did 1 year ago.
VRTX has less shares outstanding than it did 5 years ago.
The debt/assets ratio for VRTX has been reduced compared to a year ago.
2.2 Solvency
VRTX has an Altman-Z score of 12.57. This indicates that VRTX is financially healthy and has little risk of bankruptcy at the moment.
VRTX has a Altman-Z score of 12.57. This is amongst the best in the industry. VRTX outperforms 90.57% of its industry peers.
VRTX has a Debt/Equity ratio of 0.01. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.01, VRTX is in line with its industry, outperforming 42.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 12.57 |
ROIC/WACC1.74
WACC10.03%
2.3 Liquidity
VRTX has a Current Ratio of 2.65. This indicates that VRTX is financially healthy and has no problem in meeting its short term obligations.
VRTX has a Current ratio of 2.65. This is in the lower half of the industry: VRTX underperforms 67.97% of its industry peers.
A Quick Ratio of 2.29 indicates that VRTX has no problem at all paying its short term obligations.
With a Quick ratio value of 2.29, VRTX is not doing good in the industry: 71.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.65 | ||
| Quick Ratio | 2.29 |
3. Growth
3.1 Past
VRTX shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -102.42%.
Measured over the past years, VRTX shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -44.14% on average per year.
The Revenue has grown by 8.98% in the past year. This is quite good.
VRTX shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 21.50% yearly.
EPS 1Y (TTM)-102.42%
EPS 3Y-71.86%
EPS 5Y-44.14%
EPS Q2Q%-14.71%
Revenue 1Y (TTM)8.98%
Revenue growth 3Y13.31%
Revenue growth 5Y21.5%
Sales Q2Q%2.96%
3.2 Future
Based on estimates for the next years, VRTX will show a very strong growth in Earnings Per Share. The EPS will grow by 151.08% on average per year.
VRTX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.42% yearly.
EPS Next Y6198.7%
EPS Next 2Y748.83%
EPS Next 3Y329.34%
EPS Next 5Y151.08%
Revenue Next Year9.5%
Revenue Next 2Y10.05%
Revenue Next 3Y9.67%
Revenue Next 5Y10.42%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings Ratio is negative for VRTX. In the last year negative earnings were reported.
With a Price/Forward Earnings ratio of 20.87, VRTX is valued on the expensive side.
VRTX's Price/Forward Earnings ratio is rather cheap when compared to the industry. VRTX is cheaper than 91.99% of the companies in the same industry.
VRTX's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 20.87 |
4.2 Price Multiples
93.77% of the companies in the same industry are more expensive than VRTX, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 23.66 |
4.3 Compensation for Growth
VRTX's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
VRTX has a very decent profitability rating, which may justify a higher PE ratio.
VRTX's earnings are expected to grow with 329.34% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y748.83%
EPS Next 3Y329.34%
5. Dividend
5.1 Amount
No dividends for VRTX!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
436
+1.97 (+0.45%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryBiotechnology
Earnings (Last)
Earnings (Next)
Inst Owners96.16%
Inst Owner Change2.49%
Ins Owners0.15%
Ins Owner Change9.33%
Market Cap111.96B
Analysts77
Price Target516.28 (18.41%)
Short Float %1.47%
Short Ratio2.16
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-5.13%
Min EPS beat(2)-7.2%
Max EPS beat(2)-3.07%
EPS beat(4)1
Avg EPS beat(4)-133.54%
Min EPS beat(4)-527.57%
Max EPS beat(4)3.69%
EPS beat(8)4
Avg EPS beat(8)-65%
EPS beat(12)7
Avg EPS beat(12)-42.16%
EPS beat(16)10
Avg EPS beat(16)-29.51%
Revenue beat(2)1
Avg Revenue beat(2)-1.06%
Min Revenue beat(2)-4.8%
Max Revenue beat(2)2.68%
Revenue beat(4)1
Avg Revenue beat(4)-1.23%
Min Revenue beat(4)-4.8%
Max Revenue beat(4)2.68%
Revenue beat(8)3
Avg Revenue beat(8)-0.75%
Revenue beat(12)5
Avg Revenue beat(12)-0.37%
Revenue beat(16)8
Avg Revenue beat(16)0.2%
PT rev (1m)0.78%
PT rev (3m)0.66%
EPS NQ rev (1m)-1.55%
EPS NQ rev (3m)-1.63%
EPS NY rev (1m)-1.04%
EPS NY rev (3m)-0.61%
Revenue NQ rev (1m)-0.27%
Revenue NQ rev (3m)-0.2%
Revenue NY rev (1m)-0.38%
Revenue NY rev (3m)-0.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 20.87 | ||
| P/S | 10.09 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 6.79 | ||
| P/tB | 7.48 | ||
| EV/EBITDA | 23.66 |
EPS(TTM)-0.41
EYN/A
EPS(NY)20.89
Fwd EY4.79%
FCF(TTM)-4.9
FCFYN/A
OCF(TTM)-3.82
OCFYN/A
SpS43.22
BVpS64.24
TBVpS58.28
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -4.32% | ||
| ROE | -5.99% | ||
| ROCE | 22.04% | ||
| ROIC | 17.41% | ||
| ROICexc | 25.78% | ||
| ROICexgc | 29.25% | ||
| OM | 37.91% | ||
| PM (TTM) | N/A | ||
| GM | 86.03% | ||
| FCFM | N/A |
ROA(3y)10.62%
ROA(5y)14.47%
ROE(3y)13.73%
ROE(5y)19.12%
ROIC(3y)19.47%
ROIC(5y)20.15%
ROICexc(3y)50.94%
ROICexc(5y)56.27%
ROICexgc(3y)73.51%
ROICexgc(5y)87.59%
ROCE(3y)24.64%
ROCE(5y)25.5%
ROICexcg growth 3Y-26.3%
ROICexcg growth 5Y-6.95%
ROICexc growth 3Y-19.26%
ROICexc growth 5Y0.61%
OM growth 3Y2.79%
OM growth 5Y6.75%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.74%
GM growth 5Y-0.17%
F-Score4
Asset Turnover0.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 0.03 | ||
| Cap/Depr | 137.41% | ||
| Cap/Sales | 2.5% | ||
| Interest Coverage | 181.38 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.65 | ||
| Quick Ratio | 2.29 | ||
| Altman-Z | 12.57 |
F-Score4
WACC10.03%
ROIC/WACC1.74
Cap/Depr(3y)171.61%
Cap/Depr(5y)187.84%
Cap/Sales(3y)3.11%
Cap/Sales(5y)3.32%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-102.42%
EPS 3Y-71.86%
EPS 5Y-44.14%
EPS Q2Q%-14.71%
EPS Next Y6198.7%
EPS Next 2Y748.83%
EPS Next 3Y329.34%
EPS Next 5Y151.08%
Revenue 1Y (TTM)8.98%
Revenue growth 3Y13.31%
Revenue growth 5Y21.5%
Sales Q2Q%2.96%
Revenue Next Year9.5%
Revenue Next 2Y10.05%
Revenue Next 3Y9.67%
Revenue Next 5Y10.42%
EBIT growth 1Y-1.84%
EBIT growth 3Y16.47%
EBIT growth 5Y29.7%
EBIT Next Year827.23%
EBIT Next 3Y131%
EBIT Next 5Y70.46%
FCF growth 1Y-132.34%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-124.06%
OCF growth 3YN/A
OCF growth 5YN/A