It has been about a month since the last earnings report for PRA Health Sciences . Shares have lost about 0.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is PRA Health Sciences due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
PRA Health Q4 Earnings and Revenues Beat Estimates
PRA Health Sciences, Inc. reported fourth-quarter 2020 adjusted EPS of $1.55, beating the Zacks Consensus Estimate by 5.4%. The bottom line, also, rose from the prior-year quarter’s tally by 0.6%.
For 2020,adjusted EPS came in at $4.75, falling 8.1% year over year.
Revenues
For the quarter, revenues came in at $873.5 million, beating the Zacks Consensus Estimate by 5.4%. The topline grew 9.1% year over year.
For 2020, the company recorded revenues of $3.18 billion in the quarter under review, up 3.8% year over year and 3.7% at cc.
Results in Detail
Segmental Analysis
Net new business at the Clinical Research segment came in at $872.4 million. Through the segment, the company receives contracts to provide clinical research services, with payments based on fixed-fee or fee-for-service arrangements.
Revenues at the Clinical Research segment amounted to $797.5 million, up 10%year over year,while revenues at the Data Solutions segment amounted to $75.9 million, up 1.1% year over year.
Direct Costs
Direct costs totaled $437.7 million in the quarter, up 13.4% from the prior-year quarter. Per management, the increase was primarily driven by a rise in labor-related costs in the Clinical Research segment and higher data costs in the Data Solutions segment.
Margin Trend
Gross profit came in at $435.7 million, up 5.2%.Gross margin came in at 49.9%, highlighting a contraction of 187 basis points (bps).
Adjusted operating profit in the quarter grossed $315 million, up 1.4% from the year-ago quarter. Adjusted operating margin in the quarter was 36.1%, down 275 bps.
Financial Update
The company exited the fourth quarter of 2020 with cash and cash equivalents of $506.3 million, up from $236.2 million at the end of the year-ago period.
Cumulative net cash provided by operating activities totaled $427.2 million compared with $253.6 million in the year-ago period.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions. The consensus estimate has shifted -7.86% due to these changes.
VGM Scores
At this time, PRA Health Sciences has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
PRA Health Sciences has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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Why Is PRA Health Sciences (PRAH) Down 0.7% Since Last Earnings Report?
It has been about a month since the last earnings report for PRA Health Sciences . Shares have lost about 0.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is PRA Health Sciences due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
PRA Health Q4 Earnings and Revenues Beat Estimates
PRA Health Sciences, Inc. reported fourth-quarter 2020 adjusted EPS of $1.55, beating the Zacks Consensus Estimate by 5.4%. The bottom line, also, rose from the prior-year quarter’s tally by 0.6%.
For 2020,adjusted EPS came in at $4.75, falling 8.1% year over year.
Revenues
For the quarter, revenues came in at $873.5 million, beating the Zacks Consensus Estimate by 5.4%. The topline grew 9.1% year over year.
For 2020, the company recorded revenues of $3.18 billion in the quarter under review, up 3.8% year over year and 3.7% at cc.
Results in Detail
Segmental Analysis
Net new business at the Clinical Research segment came in at $872.4 million. Through the segment, the company receives contracts to provide clinical research services, with payments based on fixed-fee or fee-for-service arrangements.
Revenues at the Clinical Research segment amounted to $797.5 million, up 10%year over year,while revenues at the Data Solutions segment amounted to $75.9 million, up 1.1% year over year.
Direct Costs
Direct costs totaled $437.7 million in the quarter, up 13.4% from the prior-year quarter. Per management, the increase was primarily driven by a rise in labor-related costs in the Clinical Research segment and higher data costs in the Data Solutions segment.
Margin Trend
Gross profit came in at $435.7 million, up 5.2%.Gross margin came in at 49.9%, highlighting a contraction of 187 basis points (bps).
Adjusted operating profit in the quarter grossed $315 million, up 1.4% from the year-ago quarter. Adjusted operating margin in the quarter was 36.1%, down 275 bps.
Financial Update
The company exited the fourth quarter of 2020 with cash and cash equivalents of $506.3 million, up from $236.2 million at the end of the year-ago period.
Cumulative net cash provided by operating activities totaled $427.2 million compared with $253.6 million in the year-ago period.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions. The consensus estimate has shifted -7.86% due to these changes.
VGM Scores
At this time, PRA Health Sciences has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
PRA Health Sciences has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.