Vertex Pharmaceuticals (NASDAQ:VRTX – Get Free Report) and Gilead Sciences (NASDAQ:GILD – Get Free Report) are both large-cap healthcare companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, risk, valuation, institutional ownership, earnings and profitability.
Risk and Volatility
Vertex Pharmaceuticals has a beta of 0.28, meaning that its stock price is 72% less volatile than the S&P 500. Comparatively, Gilead Sciences has a beta of 0.31, meaning that its stock price is 69% less volatile than the S&P 500.
Profitability
This table compares Vertex Pharmaceuticals and Gilead Sciences’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Vertex Pharmaceuticals | 35.00% | 23.09% | 16.72% |
| Gilead Sciences | -10.64% | -2.11% | -0.75% |
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Vertex Pharmaceuticals | $12.00 billion | 10.64 | $3.95 billion | $17.18 | 29.29 |
| Gilead Sciences | $29.44 billion | 6.19 | $8.51 billion | ($2.67) | -55.09 |
Gilead Sciences has higher revenue and earnings than Vertex Pharmaceuticals. Gilead Sciences is trading at a lower price-to-earnings ratio than Vertex Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings for Vertex Pharmaceuticals and Gilead Sciences, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Vertex Pharmaceuticals | 0 | 2 | 20 | 1 | 2.96 |
| Gilead Sciences | 0 | 6 | 23 | 0 | 2.79 |
Vertex Pharmaceuticals currently has a consensus price target of $575.39, suggesting a potential upside of 14.34%. Gilead Sciences has a consensus price target of $159.26, suggesting a potential upside of 8.27%. Given Vertex Pharmaceuticals’ stronger consensus rating and higher probable upside, research analysts plainly believe Vertex Pharmaceuticals is more favorable than Gilead Sciences.
Insider & Institutional Ownership
91.0% of Vertex Pharmaceuticals shares are held by institutional investors. Comparatively, 83.7% of Gilead Sciences shares are held by institutional investors. 0.2% of Vertex Pharmaceuticals shares are held by company insiders. Comparatively, 0.3% of Gilead Sciences shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Summary
Vertex Pharmaceuticals beats Gilead Sciences on 10 of the 15 factors compared between the two stocks.
About Vertex Pharmaceuticals
Vertex Pharmaceuticals Incorporated, a biotechnology company, engages in developing and commercializing therapies for treating cystic fibrosis (CF). It markets TRIKAFTA/KAFTRIO for people with CF with at least one F508del mutation for 2 years of age or older; SYMDEKO/SYMKEVI for people with CF for 6 years of age or older; ORKAMBI for CF patients 1 year or older; and KALYDECO for the treatment of patients with 1 year or older who have CF with ivacaftor. The company's pipeline includes VX-522, a CFTR mRNA therapeutic designed to treat the underlying cause of CF, which is in Phase 1 clinical trial; VX-548, a non-opioid medicine for the treatment of acute and neuropathic pain which is in Phase 3 clinical trial; Exa-cel, for the treatment of sickle cell disease and transfusion-dependent beta thalassemia which is in Phase 2/3 clinical trial. In addition, it provides inaxaplin for the treatment of APOL1-mediated focal segmental glomerulosclerosis and co-morbidities, such as hypertension which is in single Phase 2/3; VX- 880 and VX-264, treatment for Type 1 Diabetes which is in Phase 1/2 clinical trial; VX-970, which is in Phase 2 clinical trial for the treatment of cancer; and VX-803 and VX-984 for treatment of cancer in Phase 1 clinical trial. Further, it sells the products to specialty pharmacy and specialty distributors in the United States, as well as retail pharmacies, hospitals, and clinics. Additionally, the company has collaborations with CRISPR Therapeutics AG.; Moderna, Inc.; Entrada Therapeutics, Inc.; Arbor Biotechnologies, Inc.; Mammoth Biosciences, Inc.; and Verve Therapeutics., as well as collaborations with Tevard Biosciences to develop novel tRNA-based therapies for duchenne muscular dystrophy. Vertex Pharmaceuticals Incorporated was founded in 1989 and is headquartered in Boston, Massachusetts.
About Gilead Sciences
Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and commercializes medicines in the areas of unmet medical need in the United States, Europe, and internationally. The company provides Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/ Eviplera, Stribild, Sunlencs, and Atripla products for the treatment of HIV/AIDS; Veklury, an injection for intravenous use, for the treatment of COVID-19; and Epclusa, Harvoni, Vemlidy, and Viread for the treatment of viral hepatitis. It also offers Yescarta, Tecartus, and Trodelvy products for the treatment of oncology; Letairis, an oral formulation for the treatment of pulmonary arterial hypertension; and AmBisome, a liposomal formulation for the treatment of serious invasive fungal infections. The company has collaboration agreements with Arcus Biosciences, Inc.; Merck Sharp & Dohme Corp.; Pionyr Immunotherapeutics Inc.; Tizona Therapeutics, Inc.; Galapagos NV; Janssen Sciences Ireland Unlimited Company; Japan Tobacco, Inc.; Dragonfly Therapeutics, Inc.; Arcellx, Inc.; Everest Medicines; Merck & Co, Inc.; Tentarix Biotherapeutics Inc.; and Assembly Biosciences, Inc. It also has research collaboration, option, and license agreement with Merus N.V. for the discovery of novel dual tumor-associated antigens (TAA) targeting trispecific antibodies. The company was incorporated in 1987 and is headquartered in Foster City, California.
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