Goldman Sachs Just Added Vertex Pharmaceuticals to Its Conviction List. Here's the Bull Case for the Big Biotech Stock
The company has tremendous prospects.
Overview
Analysts are fairly divided on Vertex Pharmaceuticals (NASDAQ: VRTX). The biotech's shares are currently trading at $546, but price targets range from $350 to $672. Analysts at Goldman Sachs are comfortably in the bull camp. Not only does the bank have a "buy" rating and a $653 price target on the stock, but it also recently added Vertex Pharmaceuticals to its highest-conviction list. Should investors be equally excited about Vertex's prospects? Let's discuss the bull case for the drugmaker.
Image source: The Motley Fool.
Vertex's strategy is simple. The company develops innovative medicines for diseases with high unmet needs, particularly (though not always) rare conditions. There are advantages and disadvantages to this approach. On the one hand, Vertex's addressable opportunity within some areas can be small. However, the company also faces less competition than it would in larger, more competitive markets. Vertex currently generates most of its revenue from its drugs that treat cystic fibrosis (CF), a rare disease that causes thick, sticky mucus to form in the lungs, disrupting breathing, trapping germs and bacteria, and leading to chronic infections.
Details
Source
Originally published at www.fool.com.