IQVIA Holdings Inc. ( IQV Quick Quote IQV - Free Report) has an impressive Growth Score of A. This style score condenses all the essential metrics from the company’s financial statements to get a true sense of quality and sustainability of its growth.
The company has an expected long-term earnings per share (three to five years) growth rate of 11.5%. Further, earnings are anticipated to register growth of 24% and 16.9% in 2021 and 2022, respectively.
The company’s shares have gained 86.3% in the past year compared with 63.7% rally of the
industry it belongs to. Key Growth Drivers
IQVIA has a consistent record of share repurchase. In 2020, 2019 and 2018, the company had repurchased shares worth $423.1 million, $945 million and $1.41 billion, respectively. Such moves instill investors’ confidence by positively impacting earnings per share.
The company has a strong healthcare-specific global IT infrastructure, analytics-driven clinical development capabilities, a robust real-world solutions ecosystem and a growing set of proprietary clinical and commercial applications that allows it to grow and retain relationships with healthcare stakeholders.
IQVIA’s addressable market size is around $260 billion and comprises outsourced research and development, real-world evidence and connected health, and technology-enabled clinical and commercial operations markets.
IQVIA has a debt-laden balance sheet. Total debt at the end of fourth-quarter 2020 was $12.5 billion, up from $12.3 billion at the end of the prior quarter. The total debt to total capital ratio of 0.67 is in line with the previous quarter’s figure. A high debt to capitalization ratio indicates higher risk of insolvency in challenging times.
Further, the company’s cash and cash equivalent of $1.9 billion at the end of the fourth quarter was well below this debt level, highlighting the fact that the company doesn’t have enough cash to meet this debt burden. The cash level, however, can meet the short-term debt of $149 million.
Zacks Rank and Stocks to Consider
IQVIA currently carries a Zacks Rank #3 (Hold).
Some better-ranked service stocks are
The Interpublic Group of Companies, Inc. (and IPG Quick Quote IPG - Free Report) , Gartner, Inc. ( IT Quick Quote IT - Free Report) TeleTech Holdings (. The Interpublic Group of Companies and Gartner carry a Zacks Rank #2 (Buy), while TeleTech sports a Zacks #1 Rank (Strong Buy). You can see TTEC Quick Quote TTEC - Free Report) the complete list of today’s Zacks #1 Rank stocks here.
The long-term expected earnings per share (three to five years) growth rate for The Interpublic Group of Companies, Gartner and TeleTech is pegged at 2.4%, 13.5% and 14.7%, respectively.
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