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Here's Why You Should Hold IQVIA Holdings in Your Portfolio

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IQVIA Holdings Inc. (IQV - Free Report) is currently benefiting from a strong technological suite and strategic collaborations that are boosting the top line.

Shares of the company have gained 19.2% in a year’s time, against the 9.3% decline of the industry.

With expected long-term earnings per share (EPS) growth rate of 13.6% and a market cap of $24.5 billion, it is a stock that investors should retain in their portfolios now.

Let’s take a look at the factors that bode well for the company.

Emerging Opportunities From Global Presence

IQVIA Holdings operates in the life sciences industry (a major part of the global healthcare system) and has a vast geographic presence. The IQVIA Institute projects that spending on pharmaceuticals in emerging markets will witness a compound annual growth rate (CAGR) of 6-9% through 2022.

The company expects to witness multiple acquisition opportunities across the industry on the back of an expanding global healthcare system. Life sciences organizations are expected to commercialize their operations in the emerging markets just as they did in the developed markets. This growing presence in emerging markets like Asia-Pacific and Africa will provide more growth opportunities for IQVIA Holdings in the life sciences industry.

Strong Technological Suite and Strategic Partnerships

The company is well poised to benefit from the technological suite. IQVIA Holdings offers an extensive range of technology solutions in the form of cloud-based applications and related services. The company’s Software as a Service (“SaaS”) solution supports a vast range of clinical and commercial processes such as clinical trial design and planning, site start-up, patient consent, site payments, content management, multi-channel marketing, customer relationship management (“CRM”), performance management, incentive compensation, territory alignment, roster management, call planning, compliance reporting and master data management.

The company’s notable strategic collaborations include agreement with Roche to utilize and deploy IQVIA commercial technologies globally, partnership with Genomics England to build a real-world research platform and a technology deal with Theramex. All these partnerships will help boost the technological solutions.

Consistent Rewards to Shareholders

IQVIA Holdings’ consistent efforts to reward shareholders in the form of share buybacks are a major positive. In the first nine months 2018, the company repurchased shares worth $792 million.

In 2017, 2016 and 2015, IQVIA Holdings repurchased shares worth $2.62 billion, $1.09 billion and $516 million, respectively. Such moves indicate the company’s commitment to create value for shareholders and underline its confidence in its business.

IQVIA Holdings Inc. Price, Consensus and EPS Surprise

 

IQVIA Holdings Inc. Price, Consensus and EPS Surprise | IQVIA Holdings Inc. Quote

 

Wrapping Up

In spite of significant growth prospects, IQVIA Holdings is not free from headwinds. It has a debt-laden balance sheet that may limit future expansion and makes risk profile worse. Moreover, the company’s global presence makes it susceptible to foreign currency exchange risk. Nevertheless, we believe that strong presence in the life sciences industry and technological prowess bode well for the company in the long term.

Zacks Rank & Stocks to Consider

Currently, IQVIA Holdings carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A few better-ranked stocks in the Zacks Business Services sector are BG Staffing, Inc. (BGSF - Free Report) , Total System Services, Inc. and Robert Half International Inc. (RHI - Free Report) , each carrying a Zacks Rank #2 (Buy).

The long-term expected EPS (three to five years) growth rate for BG Staffing, Total System Services and Robert Half is 20%, 14.2%, and 13.3%, respectively.

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