Summary
Vertex is producing rapid revenue growth and expanding profitability.
Valuation is not excessive when considering the company's growth potential.
Winners tend to keep on winning in the stock market, and Vertex is outperforming both the industry in particular and the market in general.
Looking at quantitative indicators such as financial quality, valuation, fundamental momentum, and relative strength, the big picture in Vertex looks quite compelling.
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Vertex (VRTX) is the top player in treatments for cystic fibrosis (CF). The company has made impressive advancements in recent years, obtaining regulatory approvals leading to an increase in the eligible patient population for its leading drugs KALYDECO and ORKAMBI. Vertex has also launched SYMDEKO, its third CF medicine, in 2018 and the drug is off to a strong start.
The company is aggressively working on getting its CF medicines approved for younger patients, approvals which can further expand the eligible patient population and drive sales higher. The company is expecting a decision from the FDA regarding the potential approval for KALYDECO in children as young as one year of age and for ORKAMBI in children ages 2 to 5 years this summer. Vertex is also evaluating SYMDEKO in children ages 6 to 11, and it expects data from such study later this year.
