QualityDipStocks / Health Care · Pharmaceuticals
Vertex Pharmaceuticals VRTX
Not in a dip: trading near its 52-week high.
A quality company trading well above our fair value estimate, 7% over its Market Value.
- Fair value est.
- $355.71−36%
- Market Value
- $520.81price +7%
- Off 52-wk high
- at the high
- Risk vs market
- Lowbeta 0.45
5 bullish · 5 bearish See why
Key levels
Every level vs today’s $558.88
- Fair value est.base case$355.71−36.4%
- 52-wk lowlowest close, 1 year$409.47−26.7%
- Market Valueavg paid since Aug 3$520.81−6.8%
- PriceFri Oct 30 close$558.88you are here
- 52-wk highhighest close, 1 year$558.88at the price
Fair value estimate
How the range is computed
Ten-year free-cash-flow DCF. Same 10-year free-cash-flow model as the base: discount rate 9.5% ±1 point and growth 10.4% ±2 points. Bear = 10.5% and 8.4%; bull = 8.5% and 12.4% (both fade to 3%). A model estimate from public filings, not a forecast of where the price will go.
Price is above even the bull case.
What the price implies To be worth today’s price, VRTX’s free cash flow would need to grow about 19% a year for five years; our estimate uses 10%.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 30 to Oct 30, 252 sessions). Beta = how much VRTX moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Moves much less than the market, but its own price swings are 2.3× the S&P 500’s (it moves on its own news).
- Beta vs S&P 500
- 0.45
- Volatility
- 29% vs 13% SPY
- Correlation SPY
- 0.20
- Correlation QQQ
- 0.08
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 5 of 5
ProfitabilityOperating margin of 38% over the last 12 months.
ProfitabilityReturn on equity of 24% over the last 12 months.
GrowthSales grew 10% to $12.6B over the last 12 months vs the 12 months before (SEC filings).
ProfitabilityGross margin of 86%, above the 65% median for the 81 Health Care companies we cover.
QualityPasses all four of our quality checks: cash generation, returns on capital, growth and balance sheet.
Top bearish points 5 of 5
ValuationOur DCF fair value estimate is $355.71, 36% below the price.
ProfitabilityOperating margin narrowed to 34.8% in FY2025 from 38.8% in FY2023 (SEC filings).
ValuationFree-cash-flow yield of 2.7%, below the 4.0% median for the 102 Health Care companies we cover.
ValuationPrice / book of 7.0×, above the 5.2× median for the 93 Health Care companies we cover.
ValuationTrades 7.3% above its Market Value of $520.81, the average price paid since the Aug 3 filing.
Who’s talking about it
Notable investors, executives, analysts and public figures on Vertex Pharmaceuticals in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 1, 9:09 PM ET.
Compare with peers
Closest in size in Pharmaceuticals
All fundamentals
P/E 32.4 · FCF yield 2.7% · ROE 24%
Valuation
- P/E
- 32.4×Health Care median 29.2×
- Price / FCF
- 37.6×
- FCF yield
- 2.7%
- EV / EBITDA
- n/aD&A or debt not tagged in SEC data
- Price / sales
- 11.33×
- Price / book
- 7.04×
- Market cap
- $143Bprice × diluted shares
- Enterprise value
- n/anot reported in its SEC filings
Growth
- Revenue, 12 months
- $12.6B
- Sales growth, 12 months
- +10.2%vs the 12 months before
- Sales growth, 3 yrs
- +10.4%/yrfrom FY2022
- Diluted EPS, 12 months
- $17.17
- EPS growth, last FY
- n/afewer than two years of diluted EPS
- Net income, 12 months
- $4.4B
- Net income growth
- +21%12 months vs before
Profitability
- Gross margin
- 86.0%
- Operating margin
- 38.0%
- Net margin
- 35.0%
- FCF margin
- 30.2%
- Return on equity
- 24%
- Return on invested capital
- n/aoperating income, debt, equity or cash not tagged
Balance sheet
- Cash & short-term inv.
- $7.9B
- Total debt
- n/anot reported in its SEC filings
- Net cash
- n/acash or debt not tagged in SEC data
- Debt / equity
- n/adebt or equity not tagged in SEC data
- Interest coverage
- n/ainterest expense not tagged in SEC data
Cash flow & returns
- Free cash flow, 12 months
- $3.8B
- FCF growth, 12 months
- +8%
- Dividend yield
- 0%
- Payout ratio
- n/anot reported in its SEC filings
- Buybacks, 12 months
- $2.0B1.4% of market cap
- Share count, 1 year
- −1.4%diluted shares vs a year ago
- Stock-based comp
- $689M
Trailing 12 months to Jun 30, 2026; balance sheet at Jun 30, 2026. From Vertex Pharmaceuticals’s SEC filings. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
Valuation details
DCF $355.71 · MV $520.81 · FCF value $387.83
Assumes 10.4% growth for 5 years (revenue grew 10.4% a year FY22–FY25), fading to 3%; 9.5% discount rate, 3% terminal growth. FCF base $14.88 a share (trailing 12 months to Jun 30, 2026), from the 10-Q filed Aug 4, 2026.
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. Reversal signal rules only arm once a company is in a dip.
Momentum & 52-week range
RSI 68 · 5 days +6.7%
The business
FCF $3.8B · Sales +12%
- Free cash flow, 12 months$3.8B
- Free-cash-flow yield2.8%
- Free-cash-flow margin30%
- Gross margin86%
- Operating margin38%
- Return on invested capital19%
- Return on equity24%
- Sales growth (latest quarter vs year-ago quarter)+12%
- Net debt / EBITDA−0.8×
Next report
Nov 2
- DateMon Nov 2, after the close
- Consensus EPS$4.36
- Year-ago EPS$4.22
- QuarterSep/2026
From Nasdaq’s earnings calendar. A report resets Market Value.
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.
Get a text when VRTX fires a reversal signal
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