Valuentum Exclusive Analysis for the Discerning Investor

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Aug 9, 2024

Paper: Value and Momentum Within Stocks, Too
Abstract: This paper strives to advance the field of finance in four ways: 1) it extends the theory of the “The Arithmetic of Active Management” to the investor level; 2) it addresses certain data problems of factor-based methods, namely with respect to value and book-to-market ratios, while introducing price-to-fair-value ratios in a factor-based approach; 3) it may lay the foundation for academic literature regarding the Valuentum, the value-timing, and ultra-momentum factors; and 4) it walks through the potential relative outperformance that may be harvested at the intersection of relevant, unique and compensated factors within individual stocks.

Jun 12, 2023

FDA Accepts License Application for Vertex Pharma’s and CRISPR Therapeutics’ Key Investigational Treatment
Image: Vertex's pipeline is impressive. We like its areas of focus and the progress it continues to make with key therapies in CRISPR and pain management. The combination of robust financials and a tremendous pipeline of game-changing therapeutics from exa-cel to VX-548 makes Vertex Pharma a no-brainer idea for the Best Ideas Newsletter portfolio, in our view. Vertex Pharma's shares are up nearly 18% so far in 2023, and we think its long term remains very bright. The company's dominance in CF gives it moaty economic characteristics, while the possible launch of as many as five new products in the next five years offers tremendous promise. Vertex Pharma's risk-reward situation continues to be skewed positively in investors' favor.

Feb 8, 2023

Net-Cash-Rich Vertex Pharma’s Lucrative Cystic Fibrosis Franchise Continues to Power Performance
Image Source: Vertex Pharma. We’re huge fans of Vertex Pharma. We love its net-cash-rich balance sheet, strong free-cash-flow generating capacity and lucrative and established CF franchise. We also like its long-term potential in CRISPR gene-editing technology and pain management alternatives to opioids and believe the company has other opportunities that may eventually reach commercialization across its pipeline. Our fair value estimate of Vertex Pharma stands at $320 per share, and we continue like the company as our primary biotech exposure in the Best Ideas Newsletter portfolio.

Apr 7, 2022

Best Biotech Idea Vertex Pharma Outperforming Struggling Peers, Its New Treatment for Pain a Game Changer in the Fight Against the Opioid Epidemic
Image: Vertex Pharma has advanced more than 18% since the beginning of 2021, trouncing the performance of the SPDR S&P Biotech ETF by an incredible margin. The outperformance gap stands at more than 50+ percentage points at the time of this writing. We were blown away by the phase II results released March 31 at Vertex Pharma for its non-opioid, non-addictive pain killer, the NaV1.8 inhibitor VX-548, and we think the molecule has the potential to provide a solution to the widespread opioid crisis in a meaningful way. According to the U.S. Department of Health and Human Services, tens of thousands of deaths each year are “attributed to overdosing on synthetic opioids.” The company’s phase II results for VX-548 provide “proof of concept” in order to push the study to more advanced studies, and we are highly encouraged. We also note that the long-term revenue and earnings potential for VX-548 is not included in our valuation model for Vertex Pharma and would offer pure incremental upside to our fair value estimate. VX-548 could be a game-changer in the fight against the opioid epidemic, in our view.

Jan 30, 2022

Our Favorite Biotech Vertex Pharma Powers Ahead, Leaps 6%+
Image: Vertex Pharma continues to soar toward our fair value estimate. The biotech arena is difficult to navigate, which is why we tend to play it a bit more conservative than most. Vertex Pharma has an established, cash-flow generating portfolio of cystic fibrosis therapies, which has helped to establish a net cash rich balance sheet and a steady stream of robust free cash flow, unlike many biotechs that need external capital and are at risk of never reaching commercialization. We’re excited about Vertex’s clinical pipeline of potentially transformative genetic therapies, and we like its exposure to CRISPR gene-editing technology, which could be a huge business in the years ahead. Vertex Pharma remains our favorite biotech play and an idea in the simulated Best Ideas Newsletter portfolio.

Dec 2, 2021

Best Idea Vertex Pharma Boosts Guidance (Again), Buying Back Stock While Awaiting Key Clinical Trials
Image Shown: Vertex Pharmaceuticals Inc is one of our favorite biotech ideas. Image Source: Vertex Pharmaceuticals Inc – Third Quarter of 2021 IR Earnings Presentation. Vertex Pharma has a robust drug pipeline, though all eyes are on its potential CTX001 treatment. Should the treatment receive the green light from key healthcare regulators, Vertex Pharma’s financial performance would benefit from a major growth catalyst. In the meantime, we think it is prudent for Vertex Pharma to continue leveraging its financial strength to repurchase sizable chunks of its stock. We like Vertex Pharma as an idea in the Best Ideas Newsletter portfolio.

Aug 31, 2021

Best Idea Vertex Pharma Marching Forward with Innovative CRISPR Technology
Image Shown: An overview of Vertex Pharmaceuticals commercialized drug portfolio and pipeline. Image Source: Vertex Pharmaceuticals Inc – Second Quarter of 2021 IR Earnings Presentation. The world of medicine and therapeutics continues to evolve, with gene editing CRISPR technology offering the medical community an immense source of potential life-saving therapies over the years and decades to come. Vertex Pharma is well-positioned to capitalize on any potential CRISPR technology breakthroughs, and we continue to like shares of VRTX as an idea in the Best Ideas Newsletter portfolio. Should the company's experimental gene-editing therapy CTX001 get commercialized, that would provide Vertex Pharma with an incredibly powerful growth catalyst, complementing its existing portfolio of commercialized drugs that treat cystic fibrosis (‘CF’).

Jun 14, 2021

Vertex Pharma Still Extremely Healthy Even After VX-864 Disappointment
Image Shown: Vertex Pharma has a huge net cash position on the balance sheet offering it tremendous financial flexibility. Image Source: Vertex Pharma. We like Vertex Pharma as our speculative biotech idea in the Best Ideas Newsletter portfolio, albeit as a small allocation. The company has solid revenue support with its treatments for cystic fibrosis, an extremely healthy net-cash-rich balance sheet, and tremendous free cash flow generating capacity as it advances its pipeline and grows its relationship with gene-editing firm CRISPR Therapeutics. As an idea within the context of a well-diversified equity portfolio, Vertex Pharma continues to make the cut. We still like shares.

Jun 4, 2021

Best Idea Vertex Pharma Continues to Impress
Image Shown: We are big fans of Vertex Pharmaceuticals Inc and include shares of VRTX as an idea in our Best Ideas Newsletter portfolio. The biotech firm posted a solid first quarter 2021 earnings report in late-April. Image Source: Vertex Pharmaceuticals Inc – First Quarter of 2021 Earnings IR Presentation. On April 29, Vertex Pharma reported first quarter 2021 earnings that beat both consensus top- and bottom-line estimates. Its GAAP revenues popped higher by 14% year-over-year as sales of its TRIKAFTA/KAFTRIO therapeutic offerings (TRIKAFTA is the US brand name, KAFTRIO is the European brand name) which treat cystic fibrosis (‘CF’) grew by 33% year-over-year. Economies of scale and revenue growth enabled Vertex Pharma to grow its GAAP operating income by 23% year-over-year in the first quarter. We include shares of VRTX as an idea in the Best Ideas Newsletter portfolio and continue to be huge fans of the biotech firm.

Jun 1, 2021

ICYMI -- Video: Exclusive 2020 -- Furthering the Financial Discipline
In this 40+ minute video jam-packed with must-watch content, Valuentum's President Brian Nelson talks about the Theory of Universal Valuation and how his work is furthering the financial discipline. Learn the pitfalls of factor investing and modern portfolio theory and how the efficient markets hypothesis holds little substance in the wake of COVID-19. He'll talk about what companies Valuentum likes and why, and which areas he's avoiding. This and more in Valuentum's 2020 Exclusive conference call.