Stock Analysis on Net

Vertex Pharmaceuticals Inc. (NASDAQ:VRTX)

$24.99

Price to Earnings (P/E)
since 2005

Microsoft Excel

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Calculation

Vertex Pharmaceuticals Inc., P/E, long-term trends, calculation

Microsoft Excel

Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).

1 US$

2 Data adjusted for splits and stock dividends.

3 Closing price as at the filing date of Vertex Pharmaceuticals Inc. Annual Report.


The price-to-earnings (P/E) ratio exhibits significant fluctuations over the observed period. Initially, the ratio is unavailable for several years, reflecting periods of negative earnings per share (EPS). A substantial P/E ratio of 267.42 is recorded in 2012, coinciding with a small positive EPS value following years of losses. Subsequently, the P/E ratio experiences considerable volatility, ranging from a high of 155.08 in 2017 to a low of 20.18 in 2021.

Early Period (2006-2011)
The P/E ratio is not calculable for the initial years due to consistently negative EPS. This indicates the company was not generating profits during this timeframe, making the P/E ratio meaningless as an investment metric.
Transition and Volatility (2012-2017)
The emergence of a positive, albeit small, EPS in 2012 results in a very high P/E ratio. This suggests the market had high expectations for future earnings growth. The P/E ratio then declines significantly to 155.08 in 2017, indicating increasing earnings and potentially a more rational market valuation. This period demonstrates considerable volatility, likely influenced by developments in the company’s pipeline and clinical trial results.
Stabilization and Recent Trends (2018-2024)
From 2018 onwards, the P/E ratio generally stabilizes, though fluctuations persist. The ratio decreases substantially in 2018 and 2019 as EPS increases dramatically. A subsequent rise in 2020 is followed by a decrease in 2021. In 2023, the P/E ratio is 30.42. The most recent available value, for 2024, shows a negative EPS and therefore an uncalculable P/E ratio.

Overall, the P/E ratio demonstrates a strong correlation with EPS. Periods of negative EPS result in an undefined P/E ratio, while increases in EPS generally lead to a decrease in the P/E ratio, and vice versa. The observed volatility suggests the market’s valuation of the company is sensitive to changes in earnings performance.


Comparison to Competitors

Vertex Pharmaceuticals Inc., P/E, long-term trends, comparison to competitors

Microsoft Excel

Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).


Comparison to Sector (Pharmaceuticals, Biotechnology & Life Sciences)

Vertex Pharmaceuticals Inc., P/E, long-term trends, comparison to sector (pharmaceuticals, biotechnology & life sciences)

Microsoft Excel

Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).


Comparison to Industry (Health Care)