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Clinical Development Expertise Aids IQVIA (IQV), Costs High
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IQVIA Holdings Inc. (IQV - Free Report) gains on a significantly large addressable market and innovations in its offerings. However, investors might not find the stock attractive given that it does not pay cash dividends and might not pay in the future.
IQV has reported impressive first-quarter 2024 results. Adjusted earnings (excluding 98 cents from non-recurring items) were $2.5 per share, which beat the Zacks Consensus Estimate by 2.8% and increased 3.7% from the year-ago reported figure. Total revenues of $3.7 billion surpassed the consensus estimate by 1.2% and grew 2.3% from the year-ago quarter.
How is IQVIA Doing?
IQVIA has a set of robust capabilities that places the company firmly in the life sciences space and positions it to make the most of the opportunities in the market. The company has a strong healthcare-specific global IT infrastructure, clinical development capabilities driven by analytics, a booming real-world solutions ecosystem, and a growing set of proprietary clinical and commercial applications that assist it in growing and retaining healthcare stakeholders’ relationships. It has a diversified base of more than 10,000 clients across 100 countries.
The company’s addressable market size is more than $330 billion. It consists of outsourced research and development, real-world evidence and connected health, and technology-enabled clinical and commercial operations markets. It is innovating and improving its offerings using its information, advanced analytics, transformative technology, and significant domain expertise to expand and penetrate different markets. The top line is expected to increase 2.8%, 6.6%, and 7% in 2024, 2025, and 2026, respectively.
In 2023, 2022, and 2021, the company repurchased shares worth $992 million, $1.17 billion, and $406 million, respectively. Such a strategy not only instills investors’ confidence but also impacts the bottom line positively.
IQVIA’s current ratio (a measure of liquidity) at the end of first-quarter 2024 was pegged at 0.88, higher than the preceding quarter's 0.86 and the year-ago quarter's 0.8. Increasing the current ratio bodes well.
The company currently has no intentions to pay cash dividends. Payment of dividends in the future depends on multiple factors, including financial condition, cash requirements, contractual restrictions, and other factors found relevant by the board. Investors should avoid buying IQVIA if they seek cash dividends.
IQVIA is currently witnessing an increase in operating expenses. Total operating expenses increased 1% year over year in 2023. Hence, the bottom line is likely to remain under pressure going forward. We expect it to increase 3.6%, 9.2%, and 8.4% in 2024, 2025, and 2026, respectively.
Image: Bigstock
Clinical Development Expertise Aids IQVIA (IQV), Costs High
IQVIA Holdings Inc. (IQV - Free Report) gains on a significantly large addressable market and innovations in its offerings. However, investors might not find the stock attractive given that it does not pay cash dividends and might not pay in the future.
IQV has reported impressive first-quarter 2024 results. Adjusted earnings (excluding 98 cents from non-recurring items) were $2.5 per share, which beat the Zacks Consensus Estimate by 2.8% and increased 3.7% from the year-ago reported figure. Total revenues of $3.7 billion surpassed the consensus estimate by 1.2% and grew 2.3% from the year-ago quarter.
How is IQVIA Doing?
IQVIA has a set of robust capabilities that places the company firmly in the life sciences space and positions it to make the most of the opportunities in the market. The company has a strong healthcare-specific global IT infrastructure, clinical development capabilities driven by analytics, a booming real-world solutions ecosystem, and a growing set of proprietary clinical and commercial applications that assist it in growing and retaining healthcare stakeholders’ relationships. It has a diversified base of more than 10,000 clients across 100 countries.
The company’s addressable market size is more than $330 billion. It consists of outsourced research and development, real-world evidence and connected health, and technology-enabled clinical and commercial operations markets. It is innovating and improving its offerings using its information, advanced analytics, transformative technology, and significant domain expertise to expand and penetrate different markets. The top line is expected to increase 2.8%, 6.6%, and 7% in 2024, 2025, and 2026, respectively.
In 2023, 2022, and 2021, the company repurchased shares worth $992 million, $1.17 billion, and $406 million, respectively. Such a strategy not only instills investors’ confidence but also impacts the bottom line positively.
IQVIA’s current ratio (a measure of liquidity) at the end of first-quarter 2024 was pegged at 0.88, higher than the preceding quarter's 0.86 and the year-ago quarter's 0.8. Increasing the current ratio bodes well.
The company currently has no intentions to pay cash dividends. Payment of dividends in the future depends on multiple factors, including financial condition, cash requirements, contractual restrictions, and other factors found relevant by the board. Investors should avoid buying IQVIA if they seek cash dividends.
IQVIA is currently witnessing an increase in operating expenses. Total operating expenses increased 1% year over year in 2023. Hence, the bottom line is likely to remain under pressure going forward. We expect it to increase 3.6%, 9.2%, and 8.4% in 2024, 2025, and 2026, respectively.
Zacks Rank and Stocks to Consider
IQVIA currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Business Services sector are CRA International, Inc. (CRAI - Free Report) and Fiserv ((FI - Free Report) ).
Charles River currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
CRAI has a long-term earnings growth expectation of 16%. It delivered a trailing four-quarter earnings surprise of 19.1%, on average.
Fiserv has a Zacks Rank of 2 at present. It has a long-term earnings growth expectation of 14.3%.
FI delivered a trailing four-quarter earnings surprise of 2.3%, on average.