MeritValue

VERTEX PHARMACEUTICALS INC / MA

VRTXdata completeness 88%18 fiscal years on file

Data notes: no data for concept 'totalDebt'

The thesis, from the filings

VERTEX PHARMACEUTICALS INC / MA earns about 49% on invested capital, far above its ~9% cost of capital, with a roughly flat share count — a real edge showing up in the numbers. The estimate methods put fair value between $133.43 and $214.28 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$7.57B1$8.93B2$9.87B3$11B3$12B3
Net income$2.34B4$3.32B5$3.62B6−$535.6M6$3.95B6
Operating cash flow$2.64B7$4.13B8$3.54B9−$492.6M9$3.63B9
Capital expenditure$235M10$204.7M11$200.4M12$297.7M12$437.6M12
Free cash flow (derived)$2.41B7$3.93B8$3.34B9−$790.3M9$3.19B9
Total debt—————
Cash & equivalents$6.8B13$10.5B14$10.4B14$4.57B14$5.08B14
Diluted shares259.9M259.1M260.5M257.9M258.0M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$723.48
your share of equity
Profit it earned you last year
$153.22
Free cash flow it threw off
$123.79
Debt you’d be carrying
—

10 shares is a claim on $723.48 of net worth that earned you $153.22 and generated $123.79 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
49% avg · 5y
FY21 69%FY22 96%FY23 50%FY24 1%FY25 29%

It earned about 49% on invested capital, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
−1% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $133.43 and $214.28 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$212.31
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth2.2%
  • fcfBase$3.19B
DCF · Growth Exit 5Y
$214.28
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth2.2%
  • fcfBase$3.19B
Earnings Power Value
$133.43
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$3.32B
  • growthAssumed0.0%
Graham Number
$157.92
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years2.2%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $214.28
The three cases
Bear0.0%$196.58
Base2.2%$214.28
Bull7.2%$260.62

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 2.2%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000875320-24-000062 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000875320-25-000053 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0000875320-26-000056 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000875320-24-000062 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000875320-25-000053 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000875320-26-000056 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000875320-24-000062 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000875320-25-000053 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000875320-26-000056 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000875320-24-000062 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000875320-25-000053 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0000875320-26-000056 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000875320-25-000053 (CashAndCashEquivalentsAtCarryingValue)
  14. 10-K · period ending 2022-12-31 · accession 0000875320-26-000056 (CashAndCashEquivalentsAtCarryingValue)