Are Wall Street Analysts Bullish on Vertex…

Are Wall Street Analysts Bullish on Vertex Pharmaceuticals Stock?

Boston-headquartered Vertex Pharmaceuticals Incorporated (VRTX), valued at a market cap of $123.9 billion, specializes in discovering, developing, and commercializing small molecule drugs, primarily focusing on cystic fibrosis (CF).

Shares of the biotech company have outshone the broader market in the last year. While VRTX has surged 39.3% over this time frame, the broader S&P 500 Index ($SPX) has rallied by 26.1%. In 2024, the stock rose 20.4%, compared to SPX’s 17.2% return on a YTD basis.

Zooming in further, the stock has also outpaced the VanEck Biotech ETF’s (BBH) 11.4% gains over the past 52 weeks and 9.7% on a YTD basis.

Vertex Pharmaceuticals' solid price momentum reflects its fast-paced evolution in the rare-disease market. Its CF therapy Trikafta, which serves 90% of U.S. patients, is complemented by a new triple-combination drug currently under FDA review. Additionally, Vertex is launching Casgevy, a CRISPR therapy for sickle cell disease, while awaiting approval for suzetrigine, a non-opioid pain treatment.

On Aug. 1, VRTX surged 2% following its Q2 earnings release. The company reported a loss of $3.59 billion, or $13.92 per share, which fell short of Wall Street's projected loss of $11.50 per share. However, Vertex achieved revenue of $2.65 billion, meeting forecasts. The company also raised its revenue guidance for the year to a range of $10.65 billion to $10.85 billion.

For the current fiscal year, ending in December, analysts expect Vertex’s loss per share to narrow 113.4% year over year to $1.85. The company’s earnings surprise history is mixed. It beat the consensus estimate in two of the last four quarters while missing on two other occasions.

Vertex Pharmaceuticals stock has a consensus “Moderate Buy” rating overall. Out of 30 analysts covering the stock, 19 recommend a "Strong Buy," nine advise “Hold,” and two suggest a "Strong Sell."

The consensus rating is slightly less bullish than a month before with 20 analysts suggesting a “Strong Buy.”

On Aug. 2, H.C. Wainwright analyst Andrew Fein raised Vertex Pharmaceuticals' price target to $600 from $500, which is also the Street-high price target, while maintaining a “Buy” rating. The analyst highlighted Vertex’s VX-880's superior efficacy and safety profile compared to the recently approved Lantidra.

The mean price target of $506.11 suggests a 3.3% premium from VRTX's current price levels.

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On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

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