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Vertex Pharmaceuticals
(NASDAQ:VRTX)
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Rating:80Outperform
Price Target:
$609.00
▲(27.58% Upside)
Action:Reiterated
Date:07/08/26
VRTX scores well primarily on strong financial performance (high margins, low leverage, and recovered cash generation) and a constructive earnings outlook with reiterated 2026 guidance plus multiple commercial and pipeline milestones. The score is tempered by premium valuation (P/E ~31, no dividend yield provided), technically overextended momentum signals, and incremental execution/financing risk from the Crinetics acquisition.
Positive Factors
High Gross Margins & Profitability
Sustained mid-80% gross margins and strong operating profitability create durable cash generation capacity and pricing power. This structural margin advantage supports ongoing R&D investment, commercial scale, and resilience to cost swings, underpinning long-term earnings quality.
Negative Factors
Limits to Further CF Upside
AlifTrack/TRIKAFTA label expansions already cover ~95% of CF patients, which structurally constrains incremental addressable growth from current CF drugs. Future revenue depends on next-gen assets delivering clear clinical or convenience advantages, raising pipeline execution risk for core franchise continuity.
Read all positive and negative factors
Positive Factors
Negative Factors
High Gross Margins & Profitability
Sustained mid-80% gross margins and strong operating profitability create durable cash generation capacity and pricing power. This structural margin advantage supports ongoing R&D investment, commercial scale, and resilience to cost swings, underpinning long-term earnings quality.
Read all positive factors
Vertex Pharmaceuticals Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down sales by region so you can see how reliant Vertex is on the U.S. versus Europe and other markets. Geographic concentration highlights exposure to local pricing, reimbursement, and regulatory risks, while growth outside core markets points to new patient access and diversification opportunities.
Breaks down sales by region so you can see how reliant Vertex is on the U.S. versus Europe and other markets. Geographic concentration highlights exposure to local pricing, reimbursement, and regulatory risks, while growth outside core markets points to new patient access and diversification opportunities.
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The Fly
The FlyVertex Pharmaceuticals (VRTX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$121.16B
Dividend YieldN/A
Average Volume (3M)1.75M
Price to Earnings (P/E)28.1
Beta (1Y)0.49
Revenue Growth11.75%
EPS GrowthN/A
CountryUS
Employees6,400
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)17.01
Shares Outstanding253,805,420
10 Day Avg. Volume1,243,500
30 Day Avg. Volume1,747,532
Financial Highlights & Ratios
PEG Ratio-0.03
Price to Book (P/B)6.21
Price to Sales (P/S)9.60
P/FCF Ratio36.30
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$558.78Price Target Upside17.06% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering27
EPS Forecast (FY)19.23
Revenue Forecast (FY)$13.06B
Vertex Pharmaceuticals Business Overview & Revenue Model
Company Description
Vertex Pharmaceuticals Incorporated is a leading biotechnology firm primarily focused on the discovery, advancement, and marketing of innovative treatments, particularly for cystic fibrosis (CF). The company offers a range of approved medications ...
How the Company Makes Money
Vertex primarily makes money by selling its approved prescription medicines, with the largest revenue contribution coming from its cystic fibrosis (CF) franchise. Revenue is recognized from product sales to a network of wholesalers, specialty dist...
Vertex Pharmaceuticals Earnings Call Summary
Earnings Call Date:May 04, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 03, 2026
Earnings Call Sentiment Positive
Overall the call conveyed a positive, execution-focused tone: strong top-line results (8% revenue growth to $2.99B), major commercial milestones (AlifTrack >$1B cumulative revenue, >1M Gernavix prescriptions, >500 KASJEVY patients initiated), and a standout Phase III interim win for povitacicept in IgAN with rapid BLA submission. At the same time, the company disclosed a program discontinuation (VX-522) due to tolerability, increased SG&A (30% YoY) tied to commercialization investments, and several important longer-term readouts (eGFR for renal programs, enaxaplin and AMPLITUDE results) remain pending. The positives — strong revenue and multiple high-impact pipeline/regulatory achievements — outweigh the challenges and near-term variability risks.Positive Updates
Strong Q1 Revenue Growth
Total product revenue of $2.99 billion in Q1 2026, up 8% year-over-year; non-GAAP operating income of $1.31 billion (vs. $1.18 billion prior year); non-GAAP net income of $1.1 billion and EPS of $4.47 (up from $4.06).
Negative Updates
Discontinuation of VX-522 mRNA Program
Vertex discontinued the VX-522 mRNA program for people who produce no CFTR protein due to unresolved tolerability issues (lung inflammation likely related to LNP delivery). Early termination prevents assessment of efficacy and full safety; company will close out the study.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Q1 Revenue Growth
Total product revenue of $2.99 billion in Q1 2026, up 8% year-over-year; non-GAAP operating income of $1.31 billion (vs. $1.18 billion prior year); non-GAAP net income of $1.1 billion and EPS of $4.47 (up from $4.06).
Read all positive updates
Company Guidance
Vertex reiterated 2026 guidance for total revenue of $12.95–$13.10 billion (growth of 8–9%), including an expectation of $500 million-plus from non‑CF products, with full‑year gross margin forecast just under 86%. Management reiterated combined non‑GAAP operating expenses of $5.65–$5.75 billion and a non‑GAAP effective tax rate of 19.5%–20.5% (Q1 non‑GAAP ETR was 19.6%), and said guidance reflects expected foreign‑exchange impacts net of hedging. They expect Gernavix prescriptions to more than triple in 2026 (base ~550k in 2025) with gross‑to‑net normalizing in H2, and highlighted strong visibility to the $500M+ non‑CF goal driven by growing KASJEVY and GERNAVICS contributions (Q1 KASJEVY $43M; GERNAVICS $29M). The company ended Q1 with $13.0 billion in cash and investments and deployed ~$344 million to repurchase ~741k shares, while reiterating a capital focus on innovation and commercial investment.Vertex Pharmaceuticals Financial Statement Overview
Summary
Income Statement
Balance Sheet
Cash Flow
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 12.26B | 12.07B | 11.02B | 9.87B | 8.93B | 7.57B |
| Gross Profit | 10.57B | 10.27B | 9.49B | 8.61B | 7.85B | 6.67B |
| EBITDA | 5.39B | 4.86B | 486.30M | 4.61B | 4.44B | 2.92B |
| Net Income | 4.34B | 3.95B | -535.60M | 3.62B | 3.32B | 2.34B |
Balance Sheet | ||||||
| Total Assets | 26.48B | 26.14B | 22.53B | 22.73B | 18.15B | 13.43B |
| Cash, Cash Equivalents and Short-Term Investments | 7.25B | 6.61B | 6.12B | 11.22B | 10.78B | 7.52B |
| Total Debt | 1.99B | 3.88B | 1.75B | 808.40M | 899.70M | 967.40M |
| Total Liabilities | 7.12B | 7.48B | 6.12B | 5.15B | 4.24B | 3.33B |
| Stockholders Equity | 19.36B | 18.67B | 16.41B | 17.58B | 13.91B | 10.10B |
Cash Flow | ||||||
| Free Cash Flow | 3.71B | 3.19B | -790.30M | 3.28B | 3.93B | 2.41B |
| Operating Cash Flow | 4.24B | 3.63B | -492.60M | 3.54B | 4.13B | 2.64B |
| Investing Cash Flow | -1.32B | -945.40M | -3.77B | -3.14B | -321.10M | -340.90M |
| Financing Cash Flow | -2.12B | -2.26B | -1.49B | -562.20M | -67.70M | -1.48B |
Vertex Pharmaceuticals Technical Analysis
Positive
477.36
Price Trends
464.82
Positive
455.24
Positive
451.53
Positive
Market Momentum
2.26
Positive
49.09
Neutral
24.89
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VRTX, the sentiment is Positive. The current price of 477.36 is below the 20-day moving average (MA) of 491.22, above the 50-day MA of 464.82, and above the 200-day MA of 451.53, indicating a neutral trend. The MACD of 2.26 indicates Positive momentum. The RSI at 49.09 is Neutral, neither overbought nor oversold. The STOCH value of 24.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VRTX.
Vertex Pharmaceuticals Risk Analysis
Vertex Pharmaceuticals disclosed 50 risk factors in its most recent earnings report. Vertex Pharmaceuticals reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Vertex Pharmaceuticals Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $23.51B | 16.12 | 29.31% | ― | 21.48% | 1853.63% | |
80 Outperform | $121.16B | 28.06 | 23.93% | ― | 11.75% | ― | |
74 Outperform | $68.78B | 15.42 | 14.32% | 0.55% | 5.92% | 1.85% | |
73 Outperform | $57.24B | 33.26 | 25.41% | ― | 70.57% | 30.28% | |
68 Neutral | $36.28B | 62.33 | 98.29% | ― | 82.57% | ― | |
54 Neutral | $22.59B | -15.49 | -6.67% | ― | 10.01% | -71.78% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
VRTX
Vertex Pharmaceuticals
490.39
21.98
4.69%
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ARGX
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872.23
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BNTX
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92.45
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-17.07%
Vertex Pharmaceuticals Corporate Events
Private Placements and FinancingM&A TransactionsBusiness Operations and Strategy
Vertex Pharmaceuticals to Acquire Crinetics in Cash Merger
Positive
Jul 7, 2026
On July 6, 2026, Vertex Pharmaceuticals agreed to acquire Crinetics Pharmaceuticals via a cash merger in which Crinetics will become a wholly owned subsidiary, with shareholders receiving $85 per share and unvested equity awards vesting and being ...
Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy
Vertex Shareholders Endorse Board, Governance and Equity Plan
Positive
May 13, 2026
At its annual meeting held on May 13, 2026, Vertex Pharmaceuticals’ shareholders elected ten directors, including CEO Reshma Kewalramani and Executive Chairman Jeffrey Leiden, to serve on the board until the 2027 annual meeting, reinforcing ...
Executive/Board ChangesShareholder Meetings
Vertex Director Upadhyay to Step Down Amid CFO Move
Neutral
Apr 29, 2026
On April 28, 2026, Vertex Pharmaceuticals said director Suketu Upadhyay informed its board that he would not stand for re‑election at the company’s 2026 annual meeting, as he has been named the forthcoming chief financial officer of In...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.