VRTX Valuation

Vertex Pharmaceuticals Inc

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396.620

-4.38(-1.092%)1D

Overview
Forecast
Valuation
Earnings

VRTX Relative Valuation

VRTX's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, VRTX is overvalued; if below, it's undervalued.

Historical Valuation

Vertex Pharmaceuticals Inc (VRTX) is now in the Fair zone, suggesting that its current forward PS ratio of 8.11 is considered Fairly compared with the five-year average of 186.95. The fair price of Vertex Pharmaceuticals Inc (VRTX) is between 337.13 to 456.09 according to relative valuation methord.

Relative Value

Fair Zone

337.13-456.09

Current Price：401.00

Fair

20.65

Trailing

Forward

14.46

EV/EBITDA

Vertex Pharmaceuticals Inc. (VRTX) has a current EV/EBITDA of 14.46. The 5-year average EV/EBITDA is 22.40. The thresholds are as follows: Strongly Undervalued below -25.96, Undervalued between -25.96 and -1.78, Fairly Valued between 46.58 and -1.78, Overvalued between 46.58 and 70.75, and Strongly Overvalued above 70.75. The current Forward EV/EBITDA of 14.46 falls within the Historic Trend Line -Fairly Valued range.

15.15

EV/EBIT

Vertex Pharmaceuticals Inc. (VRTX) has a current EV/EBIT of 15.15. The 5-year average EV/EBIT is 28.90. The thresholds are as follows: Strongly Undervalued below -54.52, Undervalued between -54.52 and -12.81, Fairly Valued between 70.60 and -12.81, Overvalued between 70.60 and 112.31, and Strongly Overvalued above 112.31. The current Forward EV/EBIT of 15.15 falls within the Historic Trend Line -Fairly Valued range.

8.11

Vertex Pharmaceuticals Inc. (VRTX) has a current PS of 8.11. The 5-year average PS is 8.70. The thresholds are as follows: Strongly Undervalued below 5.70, Undervalued between 5.70 and 7.20, Fairly Valued between 10.20 and 7.20, Overvalued between 10.20 and 11.71, and Strongly Overvalued above 11.71. The current Forward PS of 8.11 falls within the Historic Trend Line -Fairly Valued range.

19.45

P/OCF

Vertex Pharmaceuticals Inc. (VRTX) has a current P/OCF of 19.45. The 5-year average P/OCF is 29.34. The thresholds are as follows: Strongly Undervalued below -45.53, Undervalued between -45.53 and -8.09, Fairly Valued between 66.78 and -8.09, Overvalued between 66.78 and 104.21, and Strongly Overvalued above 104.21. The current Forward P/OCF of 19.45 falls within the Historic Trend Line -Fairly Valued range.

22.33

P/FCF

Vertex Pharmaceuticals Inc. (VRTX) has a current P/FCF of 22.33. The 5-year average P/FCF is 28.21. The thresholds are as follows: Strongly Undervalued below -11.30, Undervalued between -11.30 and 8.46, Fairly Valued between 47.97 and 8.46, Overvalued between 47.97 and 67.72, and Strongly Overvalued above 67.72. The current Forward P/FCF of 22.33 falls within the Historic Trend Line -Fairly Valued range.

Vertex Pharmaceuticals Inc (VRTX) has a current Price-to-Book (P/B) ratio of 5.98. Compared to its 3-year average P/B ratio of 6.54 , the current P/B ratio is approximately -8.53% higher. Relative to its 5-year average P/B ratio of 6.42, the current P/B ratio is about -6.80% higher. Vertex Pharmaceuticals Inc (VRTX) has a Forward Free Cash Flow (FCF) yield of approximately 3.40%. Compared to its 3-year average FCF yield of 2.48%, the current FCF yield is approximately 37.17% lower. Relative to its 5-year average FCF yield of 3.28% , the current FCF yield is about 3.84% lower.

5.98

P/B

Median3y

6.54

Median5y

6.42

3.40

FCF Yield

Median3y

2.48

Median5y

3.28

Competitors Valuation Multiple

The average P/S ratio for VRTX's competitors is 4.59, providing a benchmark for relative valuation. Vertex Pharmaceuticals Inc Corp (VRTX) exhibits a P/S ratio of 8.11, which is 76.53% above the industry average. Given its robust revenue growth of 12.06%, this premium appears unsustainable.

P/S

P/E

EV/EBITDA

EV/EBIT

P/S

Revenue Growth

Market Cap

VRTX.O

Vertex Pharmaceuticals Inc

Bristol-Myers Squibb Co

Regeneron Pharmaceuticals Inc

4.19

3.62%

59.76B

Performance Decomposition

Market capitalization of VRTX decreased by 13.78% over the past 1 year. The primary factor behind the change was an increase in P/E Change from 14.26 to 28.50.

The secondary factor is the Revenue Growth, contributed 12.06%to the performance.

Overall, the performance of VRTX in the past 1 year is driven by P/E Change. Which is more unsustainable.

12.06%

2.65B → 2.96B

Revenue Growth

-125.65%

-135.83 → 34.84

Margin Expansion

99.81%

14.26 → 28.50

P/E Change

-13.78%