Investors seeking growth at a reasonable cost should explore NASDAQ:VRTX.

Last update: May 8, 2024

Consider VERTEX PHARMACEUTICALS INC (NASDAQ:VRTX) as an affordable growth stock, identified by our stock screening tool. NASDAQ:VRTX is showcasing impressive growth figures and is well-positioned in terms of profitability, solvency, and liquidity. Moreover, it seems to be priced reasonably. Let's dive deeper into the analysis.

Exploring NASDAQ:VRTX's Growth

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:VRTX has received a 7 out of 10:

Measured over the past years, VRTX shows a very strong growth in Earnings Per Share. The EPS has been growing by 30.06% on average per year.
The Revenue has grown by 10.51% 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 26.49% yearly.
Based on estimates for the next years, VRTX will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.08% on average per year.
Based on estimates for the next years, VRTX will show a quite strong growth in Revenue. The Revenue will grow by 9.42% on average per year.

Exploring NASDAQ:VRTX's Valuation

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NASDAQ:VRTX, the assigned 5 reflects its valuation:

Compared to the rest of the industry, the Price/Earnings ratio of VRTX indicates a rather cheap valuation: VRTX is cheaper than 95.73% of the companies listed in the same industry.
95.38% of the companies in the same industry are more expensive than VRTX, based on the Price/Forward Earnings ratio.
Based on the Enterprise Value to EBITDA ratio, VRTX is valued cheaply inside the industry as 95.56% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, VRTX is valued cheaply inside the industry as 95.73% of the companies are valued more expensively.
VRTX has an outstanding profitability rating, which may justify a higher PE ratio.

Deciphering NASDAQ:VRTX's Health Rating

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:VRTX scores a 7 out of 10:

VRTX has an Altman-Z score of 14.53. This indicates that VRTX is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 14.53, VRTX belongs to the top of the industry, outperforming 89.06% of the companies in the same industry.
VRTX has a debt to FCF ratio of 0.11. This is a very positive value and a sign of high solvency as it would only need 0.11 years to pay back of all of its debts.
VRTX has a Debt to FCF ratio of 0.11. This is amongst the best in the industry. VRTX outperforms 97.44% of its industry peers.
A Debt/Equity ratio of 0.02 indicates that VRTX is not too dependend on debt financing.
VRTX has a Current Ratio of 3.99. This indicates that VRTX is financially healthy and has no problem in meeting its short term obligations.
VRTX has a Quick Ratio of 3.78. This indicates that VRTX is financially healthy and has no problem in meeting its short term obligations.

Profitability Analysis for NASDAQ:VRTX

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:VRTX has earned a 8 out of 10:

With an excellent Return On Assets value of 15.92%, VRTX belongs to the best of the industry, outperforming 98.63% of the companies in the same industry.
VRTX's Return On Equity of 20.59% is amongst the best of the industry. VRTX outperforms 97.61% of its industry peers.
Looking at the Return On Invested Capital, with a value of 16.09%, VRTX belongs to the top of the industry, outperforming 97.95% of the companies in the same industry.
VRTX had an Average Return On Invested Capital over the past 3 years of 19.51%. This is significantly above the industry average of 14.11%.
The Profit Margin of VRTX (36.68%) is better than 99.49% of its industry peers.
With an excellent Operating Margin value of 38.83%, VRTX belongs to the best of the industry, outperforming 99.32% of the companies in the same industry.
In the last couple of years the Operating Margin of VRTX has grown nicely.
The Gross Margin of VRTX (87.21%) is better than 90.94% of its industry peers.

More Affordable Growth stocks can be found in our Affordable Growth screener.

Our latest full fundamental report of VRTX contains the most current fundamental analsysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.