Looking for growth without the hefty price tag? Consider NASDAQ:VRTX.

VERTEX PHARMACEUTICALS INC (NASDAQ:VRTX) has caught the eye of our stock screener as an affordable growth stock. NASDAQ:VRTX is displaying robust growth metrics and also excels in terms of profitability, solvency, and liquidity. Additionally, it appears to be reasonably priced. Let's delve into the details.

Growth Insights: NASDAQ:VRTX

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:VRTX was assigned a score of 7 for growth:

• The Earnings Per Share has grown by an nice 17.41% over the past year.
• VRTX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 30.06% yearly.
• VRTX shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.61%.
• Measured over the past years, VRTX shows a very strong growth in Revenue. The Revenue has been growing by 26.49% on average per year.
• Based on estimates for the next years, VRTX will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.75% on average per year.
• VRTX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.49% yearly.

Understanding NASDAQ:VRTX's Valuation Score

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NASDAQ:VRTX has received a 5 out of 10:

• Based on the Price/Earnings ratio, VRTX is valued cheaper than 95.45% of the companies in the same industry.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of VRTX indicates a rather cheap valuation: VRTX is cheaper than 93.87% of the companies listed in the same industry.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VRTX indicates a rather cheap valuation: VRTX is cheaper than 95.10% of the companies listed in the same industry.
• 96.50% of the companies in the same industry are more expensive than VRTX, based on the Price/Free Cash Flow ratio.
• The excellent profitability rating of VRTX may justify a higher PE ratio.

How We Gauge Health for NASDAQ:VRTX

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:VRTX has received a 7 out of 10:

• An Altman-Z score of 16.21 indicates that VRTX is not in any danger for bankruptcy at the moment.
• VRTX's Altman-Z score of 16.21 is amongst the best of the industry. VRTX outperforms 90.54% of its industry peers.
• VRTX has a debt to FCF ratio of 0.10. This is a very positive value and a sign of high solvency as it would only need 0.10 years to pay back of all of its debts.
• The Debt to FCF ratio of VRTX (0.10) is better than 97.72% of its industry peers.
• A Debt/Equity ratio of 0.02 indicates that VRTX is not too dependend on debt financing.
• A Current Ratio of 3.50 indicates that VRTX has no problem at all paying its short term obligations.
• VRTX has a Quick Ratio of 3.29. This indicates that VRTX is financially healthy and has no problem in meeting its short term obligations.

How do we evaluate the Profitability for NASDAQ:VRTX?

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NASDAQ:VRTX, the assigned 8 is noteworthy for profitability:

• VRTX has a Return On Assets of 16.81%. This is amongst the best in the industry. VRTX outperforms 98.95% of its industry peers.
• Looking at the Return On Equity, with a value of 21.67%, VRTX belongs to the top of the industry, outperforming 97.72% of the companies in the same industry.
• The Return On Invested Capital of VRTX (16.79%) is better than 97.55% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for VRTX is above the industry average of 14.68%.
• VRTX has a Profit Margin of 39.46%. This is amongst the best in the industry. VRTX outperforms 99.30% of its industry peers.
• With an excellent Operating Margin value of 41.16%, VRTX belongs to the best of the industry, outperforming 99.30% of the companies in the same industry.
• VRTX's Operating Margin has improved in the last couple of years.
• VRTX's Gross Margin of 86.86% is amongst the best of the industry. VRTX outperforms 90.89% 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.

Disclaimer

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.