7. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX)
Number of Hedge Fund Investors: 62
Barclays head of US Equity Strategy Venu Krishna thinks Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) is one of the best stocks to offset the concentration in the market and to diversify your portfolio. Last month Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) posted solid Q1 results. The Boston-based biopharma company saw a 56% rise in adjusted EPS in the quarter on a YoY basis. Adjusted net income in the period came in at $1.24 billion, versus $794 million reported in the prior-year quarter. One of the biggest growth catalysts for the stock is Vanzacaftor, its treatment for cystic fibrosis patients. Early data shows the drug’s ability to improve lung function and sweat chloride levels. Analysts are also closely watching Vertex Pharmaceuticals Incorporated’s (NASDAQ:VRTX) pain management drug Suzetrigine and kidney disease drug Inaxaplin, both in late-stage development. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) is also working on its type 1 diabetes treatment with VX-880, a smell cellderived, fully-differentiated islet cell therapy. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) made headlines in April after it entered into a deal to acquire Alpine Immune Sciences, Inc. which makes protein-based immunotherapies, for $4.9 billion in cash
In 2024, Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) is expecting revenue in the range of $10.55 billion to $10.75 billion. The midpoint of this range would represent an 8% revenue growth on a YoY basis. Wall Street expects Vertex Pharmaceuticals Incorporated’s (NASDAQ:VRTX) EPS to rise 12% from last year, while 2025 and 2026 earnings growth are expected to come in at 8% and 12%, respectively. Based on strong growth catalyst and a healthy pipeline, the stock’s forward P/E of 29 is not outlandishly high and makes Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) a smart choice for long-term investors.
Aristotle Atlantic Core Equity Strategy stated the following regarding Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) in its fourth quarter 2023 investor letter:
“Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) develops drugs for treating cystic fibrosis, cancer, inflammatory bowel, autoimmune disease and neurological disorders. The biotechnology company has four commercial drugs used to treat cystic fibrosis. Vertex has other drugs in development, including additional cystic fibrosis treatments and medications addressing sickle cell disease, beta thalassemia, alpha-1 antitrypsin deficiency and pain.
Vertex is the global leader in treating cystic fibrosis and has additionally built a robust pipeline in several therapeutic areas. Late-stage studies in acute and neuropathic pain are expected to be another catalyst for the company. We believe Vertex’s valuation is attractive and at a discount relative to their 5-year historical average. Additionally, the company is well capitalized, with roughly $12.5 billion in net cash on its balance sheet.”
