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Medpace (MEDP) Exceeds Market Returns: Some Facts to Consider

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The latest trading session saw Medpace (MEDP - Free Report) ending at $305.90, denoting a +2.54% adjustment from its last day's close. The stock outperformed the S&P 500, which registered a daily gain of 0.55%. Elsewhere, the Dow saw an upswing of 0.25%, while the tech-heavy Nasdaq appreciated by 0.63%.

Shares of the provider of outsourced clinical development services have depreciated by 4.91% over the course of the past month, underperforming the Medical sector's gain of 3.49% and the S&P 500's gain of 6.29%.

The investment community will be paying close attention to the earnings performance of Medpace in its upcoming release. The company is predicted to post an EPS of $2.99, indicating an 8.73% growth compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $539.75 million, indicating a 2.21% growth compared to the corresponding quarter of the prior year.

MEDP's full-year Zacks Consensus Estimates are calling for earnings of $12.71 per share and revenue of $2.18 billion. These results would represent year-over-year changes of +0.63% and +3.54%, respectively.

Investors should also take note of any recent adjustments to analyst estimates for Medpace. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Medpace presently features a Zacks Rank of #3 (Hold).

Looking at its valuation, Medpace is holding a Forward P/E ratio of 23.47. For comparison, its industry has an average Forward P/E of 16.63, which means Medpace is trading at a premium to the group.

Investors should also note that MEDP has a PEG ratio of 5.38 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The average PEG ratio for the Medical Services industry stood at 1.38 at the close of the market yesterday.

The Medical Services industry is part of the Medical sector. This industry, currently bearing a Zacks Industry Rank of 70, finds itself in the top 29% echelons of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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