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IQVIA's (IQV) Extensive Database Blocks New Entrants

Zacks Equity Research
·4-min read

IQVIA Holdings Inc. IQV, has been reporting better-than-expected results in the four trailing quarters. The company is known for its global IT infrastructure, analytics-driven clinical development capabilities, and a robust real-world solutions ecosystem.

IQVIA Holdings Inc. reported solid first-quarter 2023 results, wherein earnings and revenues surpassed the Zacks Consensus Estimate. Adjusted earnings per share of $2.45 beat the Zacks Consensus Estimate of $2.41 but declined on a year-over-year basis. Total revenues of $3,652 million outpaced the consensus estimate of $3,608.2 million and increased 2.4% year over year on a reported basis and 4.7% on a constant-currency basis.

Current Situation of IQVIA

IQVIA is serving 85% of the pharmaceuticals operating worldwide. It has a huge collection of healthcare information that comprises pervasive patient records across sales, prescription and promotional data, electronic medical records, medical claims, genomics and social media. The huge database is one of the company’s key assets and is the primary barrier for new entrants.

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IQVIA operates in a market that is worth around $300 billion and the company is trying to penetrate deep into these markets by appropriately deploying its information, advanced analytics, transformative technology and significant domain expertise.

IQVIA Holdings Inc. Revenue (TTM)

 

IQVIA Holdings Inc. Revenue (TTM)
IQVIA Holdings Inc. Revenue (TTM)

IQVIA Holdings Inc. revenue-ttm | IQVIA Holdings Inc. Quote

 

The company has a consistent record of share repurchases. In 2022, 2021 and 2020, IQVIA had repurchased shares worth $1.17 billion, $406 million and $447 million, respectively. Such moves not only instill investors’ confidence but also positively impact earnings per share.

Some Concerning Points

IQVIA's current ratio at the end of first-quarter 2023 was pegged at 0.8, lower than the current ratio of 0.93 reported at the end of the year-ago quarter. It indicates that the company may have problems meeting its short-term debt obligations.

Increasing selling, general and administrative expenses are having a toll on the company’s bottom line. In 2022, SG&A expenses were $2.07 billion. In 2021, SG&A expenses of $1.96 billion increased 9.8% year over year. The same rose 3.2% year over year in 2020 and 1% in 2019.

The shares of IQV have decreased 1.6% in the year-to-date period against its industry’s 6.2% increase.

Zacks Rank and Stocks to Consider

IQV currently carries a Zacks Rank #3 (Hold).

Investors interested in the Zacks Business Servicessector can consider the following stocks:

Green Dot GDOT: For second-quarter 2023, the Zacks Consensus Estimate of Green Dot’s revenues suggests a decline of 4.2% year over year to $340.1 million and the same for earnings indicates a 52.7% dip to 35 cents per share. The company has an impressive earning surprise history, beating the consensus mark in all four trailing quarters, the average surprise being 37.3%.

GDOT has a VGM score of A and currently sports a Zacks Rank #1(Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

DocuSign DOCU: For the first quarter of fiscal 2023, the Zacks Consensus Estimate of DocuSign’s revenues suggests an increase of 8.9% year over year to $641.2 million and the same for earnings suggests an increase of 39.5% to 53 cents per share. The company has an impressive earning surprise history, beating the Zacks Consensus mark in three instances and missing on one instance, the average surprise being 12.3%.

DOCU has a growth score of A along with a Zacks Rank of 3,  at present.

Maximus MMS: For second-quarter 2023, the Zacks Consensus Estimate of Maximus’ revenues suggests an increase of 6.1% year over year to $1.2 billion and the same for earnings indicates a 33.3% rise to $1.04 per share. The company has an impressive earning surprise history, beating the consensus mark in three instances and missing on one instance, the average surprise being 9.6%.

MMS has a VGM score of A along with a Zacks Rank of 1.

 

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Green Dot Corporation (GDOT) : Free Stock Analysis Report

Maximus, Inc. (MMS) : Free Stock Analysis Report

IQVIA Holdings Inc. (IQV) : Free Stock Analysis Report

DocuSign (DOCU) : Free Stock Analysis Report

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Zacks Investment Research