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This Magnificent S&P 500 Dividend Stock Is Down 18% -- Time to Buy?
The Motley Fool· 2025-08-24 15:26
Core Viewpoint - Vertex Pharmaceuticals has faced significant challenges over the past year, resulting in an 18% decline in share price, but there are potential opportunities for investors as the company may recover and return to its market-beating performance [1][2]. Group 1: Clinical Setbacks - Vertex Pharmaceuticals encountered multiple clinical failures, including the abandonment of suzetrigine for lumbosacral radiculopathy after disappointing phase 2 trial results [3]. - The candidate VX-993 also failed in phase 2 studies as a monotherapy for acute pain [4]. - The company discontinued its candidate VX-264 for type 1 diabetes after early-stage trial failures [6]. Group 2: Financial Performance - Despite clinical setbacks, Vertex's financial results remain robust, with a 12% year-over-year revenue increase to $2.96 billion in the second quarter [8]. - The net income for the second quarter was $1 billion, a significant recovery from a net loss of $3.6 billion in the same quarter of 2024, which was attributed to one-off acquisition expenses [8]. Group 3: Product Launches and Market Potential - Vertex's recent product launches include Alyftrek for cystic fibrosis, Journavx for acute pain, and Casgevy for rare blood disorders [9]. - Alyftrek generated $156.8 million in revenue during the quarter and is expected to maintain growth as Vertex expands its market presence in cystic fibrosis [10]. - Journavx, the first oral non-opioid pain signal inhibitor approved by the FDA, has over 150 million patients in the U.S. covered for reimbursement, indicating strong market potential [11]. - Casgevy, a complex gene-editing therapy, has seen limited sales but holds significant potential as a one-time cure for diseases with few safe treatment options [12]. Group 4: Future Outlook - Vertex is expected to continue revenue and earnings growth over the next five years, despite the inherent risks in developing novel medicines [13]. - The company is advancing suzetrigine into phase 3 studies for diabetic peripheral neuropathy and conducting a phase 2 trial for VX-993 in that indication [14]. - Vertex's late-stage pipeline includes promising candidates like zimislecel for type 1 diabetes, with regulatory submissions planned for 2026 based on strong data [14]. - Additional promising compounds in phase 3 studies include inaxaplin for APOL-1-mediated kidney disease and povetacicept for IgA nephropathy, suggesting potential for new medicines in the near future [15]. - Early-stage programs for pain, cystic fibrosis, and other diseases are also expected to progress, reinforcing the attractiveness of Vertex's shares despite recent underperformance [16].
Is This Beaten-Down Stock a Buy on the Dip?
The Motley Fool· 2025-08-15 13:30
Core Viewpoint - Vertex Pharmaceuticals has experienced significant stock declines due to recent clinical and regulatory setbacks, but it may present an attractive investment opportunity for long-term investors [1][2]. Group 1: Recent Developments - Vertex's stock fell over 10% after disappointing regulatory and clinical news, marking the second significant drop this year [1]. - The company's pain treatment drug, Journavx, underperformed in a phase 2 study, leading to a decision to abandon further development for a specific indication [5]. - Another investigational therapy, VX-993, also failed phase 2 studies, contributing to the stock's decline [6]. Group 2: Financial Performance - Despite recent setbacks, Vertex reported a 12% year-over-year revenue increase to $2.96 billion in the second quarter, driven by its cystic fibrosis (CF) business [7]. - The company remains the only provider of drugs targeting the underlying causes of CF, indicating potential for growth in its core franchise [8]. Group 3: Diversification and Pipeline - Vertex has diversified its product lineup, including the approval of Casgevy, a gene-editing therapy for rare blood disorders, and positive launch indications for Journavx [9]. - The company is enrolling patients for phase 3 studies of Journavx in diabetic peripheral neuropathy, indicating ongoing efforts in the pain treatment market [10]. - Vertex has promising pipeline candidates, such as zimislecel for type 1 diabetes, which could be a functional cure, and inaxaplin for APOL-1-mediated kidney disease, a condition lacking approved therapies [11][12].
2 Growth Stocks That Are No-Brainer Buys Right Now
The Motley Fool· 2025-08-15 12:30
Group 1: Vertex Pharmaceuticals - Vertex Pharmaceuticals' shares recently declined due to a clinical setback with its VX-993 treatment for acute pain, which did not perform well in a phase 2 study, and the decision to halt pursuit of a promising indication for its new pain medicine, Journavx [4] - Despite the recent drop, Vertex's overall business remains robust, with a 12% year-over-year revenue increase to $2.96 billion in the second quarter [5] - Vertex is the sole provider of cystic fibrosis (CF) medications, with its latest product, Alyftrek, generating $156.8 million in sales in the second quarter, highlighting its significant pricing power in the CF market [6] - The company has promising late-stage assets, including zimislecel for type 1 diabetes, with regulatory applications planned for next year [7] - Historically, Vertex has recovered from similar stock declines due to strong financial results and clinical progress, suggesting a potential rebound following the recent dip [9] Group 2: Netflix - Netflix has experienced strong revenue growth, with a 15.9% year-over-year increase to $11.1 billion in the second quarter, alongside profitable growth in margins and free cash flow [10] - The company anticipates significant subscriber growth, with management stating that hundreds of millions of potential new users remain, and increased engagement could enhance its advertising business [11] - Netflix estimates it has captured only about 6% of its revenue potential, indicating substantial long-term opportunities as streaming continues to replace cable [12] - Despite concerns about valuation, with the stock trading at around 48 times forward earnings compared to the average of 20 for communication services, Netflix's transformative impact on the entertainment industry makes it an attractive investment [12][13] - The company's long-term vision may take years to fully realize, but its vast addressable market supports the attractiveness of its stock [13]
VRTX Q2 Earnings Beat, Stock Down as Pain Drug Misses Study Goal
ZACKS· 2025-08-05 16:35
Core Insights - Vertex Pharmaceuticals reported adjusted earnings of $4.52 per share for Q2 2025, exceeding the Zacks Consensus Estimate of $4.24, and a significant improvement from an adjusted loss of $12.83 per share in the same quarter last year due to the $4.9 billion acquisition of Alpine Immune Sciences [1][7] - Total revenues for Q2 reached $2.96 billion, surpassing the Zacks Consensus Estimate of $2.89 billion, marking a 12% year-over-year increase driven by strong sales of Trikafta/Kaftrio and contributions from ongoing product launches [2][5] - Vertex's stock has increased by 17.3% year-to-date, significantly outperforming the industry average of 0.2% [4] Financial Performance - U.S. revenues rose 14% year over year to $1.85 billion, while international sales increased 8% to $1.12 billion, supported by strong demand and the launch of Casgevy [5] - Trikafta generated $2.55 billion in sales, a 4.2% increase year over year, narrowly missing the consensus estimate of $2.56 billion [8] - Alyftrek, a newly approved CF treatment, generated $156.8 million in Q2, up from $53.9 million in Q1 2025, indicating strong uptake among eligible patients [9] Product Revenue Breakdown - Total product revenues included sales from Trikafta/Kaftrio, Alyftrek, and other products, with Casgevy sales reaching $30.4 million, reflecting a 114.1% sequential increase [10] - Journavx, a new pain drug, generated $12 million in sales in Q2, receiving positive feedback from both physicians and patients [12] Cost and Guidance - Adjusted R&D expenses increased by 25.9% year over year to $878.1 million, while SG&A expenses rose 28.2% to $359.4 million due to investments in clinical studies and commercial capabilities [13] - Vertex maintained its total revenue guidance for 2025, expecting revenues between $11.85 billion and $12 billion, driven by growth in CF medicines and new product launches [15] Pipeline Developments - Vertex announced disappointing results for VX-993, a pain drug, which failed to meet its primary endpoint in a phase II study, leading to the decision to halt its development as a monotherapy [18][19] - The company continues to advance its pipeline, including studies for povetacicept and zimislecel, targeting various diseases [22][23]
Vertex Gets EU Nod for New Cystic Fibrosis Drug Alyftrek
ZACKS· 2025-07-02 13:35
Core Insights - Vertex Pharmaceuticals (VRTX) received European Commission approval for Alyftrek (deutivacaftor/tezacaftor/vanzacaftor) to treat cystic fibrosis (CF) patients aged six and older with at least one non-class I mutation in the CFTR gene [1][2] - Alyftrek is a combination of three drugs and offers once-daily dosing, potentially providing better patient benefits compared to Trikafta [7][9] - The approval was anticipated following a positive opinion from the European Medical Agency's Committee for Medicinal Products for Human Use in April [2] Product and Market Position - Alyftrek is Vertex's fifth CFTR modulator therapy and was previously approved by the FDA in December 2024 and in the UK in March [2] - Regulatory filings for Alyftrek are under review in Canada, Switzerland, Australia, and New Zealand [3] - Vertex holds a dominant position in the CF market, with sales driven by the demand for Trikafta/Kaftrio, particularly in younger age groups [8] Financial Performance - Alyftrek generated sales of $53.9 million in Q1 2025, with expectations for stronger uptake in H2 2025 as patients switch from Trikafta [7][11] - Year-to-date, Vertex's shares have risen 12.3%, contrasting with a 3.4% decline in the industry [4] Clinical Efficacy - In head-to-head studies, Alyftrek demonstrated non-inferiority to Trikafta in improving ppFEV1 and showed superior reduction in sweat chloride levels, indicating better CFTR function [10] - Management believes Alyftrek could become a new standard-of-care treatment for CF and may treat patients who have discontinued Trikafta or other Vertex CF medicines [9] Future Outlook - Management anticipates that Alyftrek sales will increase as the majority of current Trikafta patients in the U.S. are expected to switch to Alyftrek [11] - Vertex is also evaluating Alyftrek for use in children with CF aged between two and five years [11]
Vertex Down Around 9% in Three Months: Should You Buy, Sell or Hold the Stock?
ZACKS· 2025-06-30 13:31
Core Viewpoint - Vertex Pharmaceuticals has experienced an 8.9% decline in stock price over the past three months, attributed to soft first-quarter results, slower uptake of new drugs, and geopolitical tensions affecting economic growth [1][2][10]. Group 1: Financial Performance - Vertex's CF product sales continue to grow, driven by demand for Trikafta/Kaftrio among younger age groups, although there are concerns about a slight slowdown in sales growth [4]. - The company expects CF sales to grow approximately 8% in 2025, supported by the launch of new products and continued demand for existing therapies [10][24]. - The Zacks Consensus Estimate for 2025 earnings has increased from $17.69 to $17.82 per share over the past 60 days, indicating positive analyst sentiment [22]. Group 2: Product Pipeline and Approvals - Vertex has gained approval for two new products: Journavx, a non-opioid pain medicine, and Alyftrek, a new CF treatment, with expectations for sales to improve in the second half of 2025 [5][10]. - Casgevy, a CRISPR-based therapy for sickle cell disease and beta-thalassemia, is anticipated to ramp up revenues as more patients are treated in approved regions [8][11]. - Vertex's pipeline includes several mid- to late-stage programs targeting various diseases, with four programs in pivotal development and potential regulatory filings expected next year [12][13]. Group 3: Market Position and Competition - Vertex maintains a dominant position in the CF market with minimal competition, which is expected to support continued sales growth despite recent challenges [24]. - The company is addressing concerns about its reliance on the CF franchise for growth by diversifying its product offerings with new therapies [24].
4 Monster Stocks to Buy and Hold for the Next Decade
The Motley Fool· 2025-06-02 08:10
Market Overview - The U.S. equity market in 2025 has been volatile due to trade tensions, macroeconomic uncertainties, and geopolitical challenges impacting investor sentiment [1] Investment Strategy - Market volatility presents opportunities to acquire fundamentally strong, high-quality stocks with robust growth prospects at attractive valuations, historically yielding significant returns for patient investors [2] Stock Analysis Microsoft - Microsoft is well-positioned to capitalize on the AI wave, with a critical role in building AI infrastructure globally and a deep partnership with OpenAI [5][6] - The company commands a 22% market share in the AI infrastructure space through its Azure cloud platform, which is expanding with new data centers in 10 countries [6] - Microsoft has a high annuity mix of 98% in recurring revenue, with commercial remaining performance obligations growing 34% year-over-year to $315 billion [7] - The company maintains a robust cash balance of $79.6 billion, allowing for aggressive AI investments while returning $9.7 billion to shareholders [7][8] Meta Platforms - Meta Platforms dominates digital advertising, generating nearly $41.4 billion in revenue by reaching 3.4 billion daily users across its social media applications [9] - AI investments have led to increased user engagement, with time spent on Facebook and Instagram rising by 7% and 6%, respectively, and ad conversion rates for Reels improving by 5% [10] - The company plans to invest $64 billion to $72 billion in fiscal 2025, leveraging its large user base for business messaging and mobile commerce [11] Amazon - Amazon's AWS leads the cloud infrastructure market with a 29% share and achieved a $117 billion annualized revenue run rate with a 40% margin [12] - The e-commerce segment is strengthening through improved logistics and automation, while advertising revenue reached $13.9 billion in the first quarter [13] - Amazon's AI capabilities are rapidly growing, with the AI business already at a "multibillion-dollar annual run rate" and expanding at triple-digit year-over-year percentages [14][15] Vertex Pharmaceuticals - Vertex Pharmaceuticals leads the cystic fibrosis market, generating over $10 billion in annual revenue from its CF franchise, primarily driven by the drug Trikafta [16][17] - The recently approved CF drug Alyftrek shows better efficacy and convenience, potentially expanding market penetration [17] - Vertex is financially stable with $11.4 billion in cash, allowing for significant investment in growth initiatives, including a strong pipeline of late-stage programs [19]
3 Top Growth Stocks to Buy in the Second Half of 2025
The Motley Fool· 2025-05-26 08:46
Core Viewpoint - The stock market is expected to remain volatile, but there are promising growth stocks to consider for investment in the second half of 2025 Group 1: Amazon - Amazon is expected to maintain its business resilience despite potential tariffs from the Trump administration [3] - The company has been ranked as the lowest-cost online U.S. retailer for eight consecutive years, indicating strong competitive pricing [4] - Amazon Web Services (AWS) is anticipated to continue driving profit growth, aided by advancements in AI technology [5] - The e-commerce segment has significant growth potential, and new initiatives like Project Kuiper satellite internet service are expected to contribute to long-term growth [6] Group 2: Meta Platforms - Meta Platforms has a vast user base, with approximately 3.43 billion daily users across its applications [7] - The integration of AI is enhancing user engagement and advertising revenue potential, particularly through business messaging on Messenger and WhatsApp [8] - Smart glasses are viewed as a potential growth driver, with expectations that a significant portion of eyeglasses will transition to AI-enabled versions in the coming years [9] - Despite facing risks such as tariffs and antitrust lawsuits, the potential rewards of investing in Meta stock are considered to outweigh these risks [10] Group 3: Vertex Pharmaceuticals - Vertex Pharmaceuticals is noted for its legal monopoly in treating cystic fibrosis, which reduces investment risk compared to other biotech stocks [11] - The FDA approved Vertex's new CF drug, Alyftrek, which offers improved dosing and effectiveness compared to existing treatments [12] - Vertex's pipeline includes promising products like Journavx, a non-opioid pain drug, and upcoming regulatory filings for treatments in diabetes and kidney diseases [13][14] - While there are risks associated with the biotech sector, Vertex is predicted to be a strong performer in the long run due to its innovative pipeline and market position [14]
2 Monster Growth Stocks to Buy and Hold for 10 Years
The Motley Fool· 2025-05-24 17:05
Market Overview - The recent market correction appears significant on a year-to-date chart but is expected to look less daunting over a decade, as bull markets typically last longer than downturns, leading to strong returns for most stocks over the long term [1] E-commerce Industry - E-commerce is projected to continue its growth, with only 16.2% of retail transactions in the U.S. being online as of the first quarter, indicating substantial room for growth [5] - Shopify is positioned to benefit from this trend as it enables merchants to create online storefronts, which is essential for success in the digital age [4][6] Shopify - Shopify has established itself as an innovator in the e-commerce market, offering a comprehensive suite of services including marketing, payment processing, and inventory management, which allows business owners to focus on other aspects of their operations [6] - The company has a competitive advantage due to high switching costs, which is crucial for long-term performance, although it is not consistently profitable and faces stiff competition [7] - Shopify has captured over 12% of the U.S. e-commerce market by gross merchandise volume and is expected to perform well in the next decade, especially after strategic changes that have brought it closer to profitability [8][9] Vertex Pharmaceuticals - Vertex Pharmaceuticals is a leading biotech company that has faced challenges, including disappointing phase 2 results for a drug and poor first-quarter results, but its long-term outlook remains attractive [10][11] - The company has a strong position in the cystic fibrosis market, being the only provider of medicines that address the underlying causes of the disease, which continues to drive top-line growth [11] - Vertex is expanding its product lineup with recent approvals for new medicines and has several other drugs in development, including a potential approval for a type 1 diabetes program by next year [14] - Despite recent performance issues, Vertex is considered a strong buy at current levels, with expectations for significant returns through 2035 [15]
My Favorite Tariff Safe-Haven Stock to Buy on the Dip
The Motley Fool· 2025-05-10 08:12
Core Viewpoint - The article highlights Vertex Pharmaceuticals as a strong investment opportunity amidst market uncertainty due to import tariffs, emphasizing its robust revenue from cystic fibrosis treatments and low exposure to tariff impacts. Company Overview - Vertex Pharmaceuticals specializes in treating cystic fibrosis (CF) and has generated over $11 billion in revenue last year, with a strong profitability profile [4][7]. - The company’s flagship drug, Trikafta, addresses 90% of the CF population, and its newly approved drug, Alyftrek, shows promise in treating additional mutations [5][6]. Growth Drivers - Vertex is expected to transition patients from Trikafta to Alyftrek and build a multibillion-dollar pain management business with the launch of Journavx [8]. - The company is also set to benefit from the rollout of its gene editing therapy, Casgevy, which is anticipated to contribute significantly to revenue in the coming quarters [10]. Financial Performance - Despite a recent drop in shares, Vertex increased its low-end revenue guidance for the year to $11.85 billion from $11.75 billion, with the high end remaining at $12 billion [10]. - The recent decline in share price has left Vertex trading at 23 times forward earnings estimates, down from over 28 times earlier this year, presenting a potentially attractive valuation [13]. Tariff Impact - Vertex forecasts an "immaterial cost impact from tariffs" due to its limited exposure to China and a diversified supply chain, with most CF drugs produced in the U.S. [11][12]. - This positioning makes Vertex a "tariff safe haven" in the current market environment [13][14].