We recently published a list of 15 Best Stocks to Buy According to Jim Simons’ Renaissance Technologies In this article, we are going to take a look at where Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) stands against other best stocks to buy according to Jim Simons’ Renaissance Technologies.

Even after his passing in 2024, billionaire investor and mathematician Jim Simons remains known as the “Quant King” of hedge funds due to the extraordinary success of Renaissance Technologies, his quantitative trading firm based in New York. After years of researching the finance industry, Simons realized the untapped potential of employing quantitative analysis to capitalize on market inefficiencies. This insight led him to develop a data-driven investment strategy of analyzing market behavior solely using statistical and mathematical models. By identifying subtle, non-random patterns in financial data, the quant genius predicted future stock movements and generated impressive returns.

Although it is closed to outside investors, Jim Simons’ secretive Medallion hedge fund, a flagship of Renaissance, has produced ground-breaking results since its inception. The Medallion Fund raked in impressive returns of 56.6% and 74.6% during the early 2000s dot-com crash and the global financial crisis between 2007 and 2011. The fund has maintained a substantial annual return of 31.5% since its first two years of operation. At the time of his death, Simons was worth $31.4 billion, ranking him among the world’s wealthiest individuals, thanks to the strong market performance of the Medallion Fund and Renaissance.

READ ALSO: Billionaire David Einhorn’s 10 Stock Picks with Huge Upside Potential and Billionaire Michael Platt’s 10 Stock Picks with Huge Upside Potential.

Renaissance Technologies’ computer-driven powerhouse came off to a great start after a stellar performance in 2024. The Renaissance Institutional Diversified Alpha Fund has gained 9.05% as of February, continuing to build on its impressive 2024 return of 15.6%, which was its best since its inception in 2021. Meanwhile, the Renaissance Institutional Equities Fund has had its best start in over ten years, rising 11.85% in the first two months of 2025. Both funds are allowed to maintain sizable individual stock positions in addition to using stock index futures and options to help manage risk. However, the firm warns that it may be difficult to quickly unwind these sizable holdings without impacting market prices.

Our Methodology

For this list, we picked stocks from Renaissance Technologies’ 13F portfolio as of the end of the fourth quarter of 2024. These equities are also popular among elite hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX)

Renaissance Technologies Q4 Stake: $562.6 million

Number of Hedge Fund Holders: 58

Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) is a global biotechnology company that is involved in the discovery and development of small-molecule medications for the treatment of severe illnesses, including cystic fibrosis.

Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) reported first-quarter earnings that narrowly fell short of consensus projections, with significant underperformance in sales of its Alyftrek and Journavx medications. Despite this, the company expressed confidence in future growth by increasing the lower end of its financial guidance by $100 million.

On May 7, Bernstein analysts reiterated the $462 price target for Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) while maintaining their Market Perform rating. Analyst William Pickering urged investors to exercise patience after Vertex shares experienced a notable 10% decline on May 6. Bernstein’s position suggests a cautious approach, with the firm emphasizing the significance of impending product launches and clinical trial results in determining the future trajectory of the company’s stock value.

GreensKeeper Asset Management stated the following regarding Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) in its Q1 2025 investor letter:

“Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) was our second-best performer in the quarter, +20.4%. Growing demand for its Cystic Fibrosis (CF) franchise continued to generate substantial free cash flow. Vertex remains focused on diversifying its product portfolio and recently launched two new approved therapies: Alyftrek and Journavx. Alyfrtek is an improvement to VRTX’s CF portfolio, offering a once-daily dosing regimen that is far more convenient for patients. Importantly, it covers 31 additional rare mutations of CF for which no previous treatment existed. Journavx, a non-opioid pain signal inhibitor for acute pain, is beginning to ramp up sales as physicians gain confidence in its real-world efficacy and as VRTX advances reimbursement negotiations with payors. We believe that Journavx has the potential to become a blockbuster therapy, providing significant quality-of-life improvements to patients. In addition, VRTX is developing therapies for chronic pain that utilize a similar mechanism of action—blocking selective sodium channels—to inhibit the transmission of pain signals with little off-target effects. Success would be great news for shareholders, but more importantly, offer a powerful alternative to opioids and help combat the opioid crisis.”

Overall, VRTX ranks 7th on our list of best stocks to buy according to Jim Simons’ Renaissance Technologies. While we acknowledge the potential for VRTX as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%.  If you are looking for an AI stock that is more promising than VRTX but trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.