Why Vertex Pharmaceuticals Incorporated, Alexion Pharmaceuticals, Inc., and F5 Networks, Inc. Are Today’s 3 Worst Stocks

Stocks from the health-care and tech sectors end at the bottom of the stock market today.

May 2, 2014 at 7:42PM

Wall Street, anxiously awaiting Friday's jobs report for the last several days, finally got the news it was waiting for today. But the monthly employment snapshot, instead of providing a nice, clean-cut, crystal-clear data set for investors to make sound decisions upon, provided both extremely positive and starkly negative news. On the plus side, nonfarm payrolls surged by 288,000 in April, crushing the consensus forecast of 215,000. However, at the same time, Americans dropped out of the labor force left and right, as the labor force declined by more than 800,000 last month. The stock market fell slightly on the news, but Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX), Alexion Pharmaceuticals, (NASDAQ:ALXN), and F5 Networks, (NASDAQ:FFIV) all cratered in trading on Friday. Meanwhile the S&P 500 Index (SNPINDEX:^GSPC) shed two points, or 0.1%, to end at 1,881. 

Vertex Pharmaceuticals stock fell 3.7% today in reaction to news that the company would be doubling down on its efforts to sell cystic fibrosis treatments rather than its once-popular Hepatitis C drug, Incivek. Although quarterly revenue from its cystic fibrosis drug Kalydeco surged more than 60% to nearly $100 million, the company's overall sales plummeted 64% as Incivek went from selling more than $200 million in the year-ago period to less than $4 million in the first quarter of 2014. Vertex is now a one-trick pony reliant on Kalydeco sales, but it'll be tough to match the explosive sales growth Incivek once brought to the company. 


Source: Alexion website

Shares of another biotech company, Alexion Pharmaceuticals, slumped 2.9% Friday, as the health-care sector generally struggled, losing 0.8% on the whole. Alexion Pharmaceuticals is often mentioned in the same breath as Vertex, since both companies make their bread and butter on orphan drugs, or drugs that affect a very small percentage of the population. In order to make the sale of these orphan drugs economical, these businesses stick the drugs with sky-high price tags. In the case of Alexion, its drug, Soliris -- used to treat paroxysmal nocturnal hemoglobinuria -- is the most expensive drug in the world, with a sticker price of more than $400,000.

The tech sector also ended as one of Friday's losers. Shares of F5 Networks tumbled 2.8% today. Unfortunately, there wasn't a definitive catalyst driving the stock lower -- in fact, F5's recent results have been largely positive. Sales jumped by 20% in the most recent quarter as the company's cash-rich telecom clients ramped up spending on infrastructure. F5, which sells products that make networks run more smoothly and efficiently, is firmly positioned in an industry that won't be going away anytime soon, so take today's minor pullback with a grain of salt.

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John Divine has no position in any stocks mentioned. You can follow him on Twitter @divinebizkid and on Motley Fool CAPS @TMFDivine.

The Motley Fool recommends Vertex Pharmaceuticals. The Motley Fool owns shares of F5 Networks. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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