Back to top

Image: Bigstock

Here's Why You Should Hold on to Medidata (MDSO) Stock Now

Read MoreHide Full Article

Medidata Solutions, Inc. is well poised for growth on the back of strong focus on cloud-based services, strategic buyouts and Rave Genomics platform. However, the market for clinical trial solutions is highly competitive, which in turn, might hurt the company’s prospects over the long haul.

The stock currently carries a Zacks Rank #3 (Hold).

Price Performance

Shares of Medidata Solutions have gained 36%, compared with the industry’s growth of 24.3% on a year-to-date basis. The stock also compares favorably with the S&P 500 Index’s rally of 8.9%.



What’s Favoring the Stock?

Medidata Solutions remains focused on cloud-based services that have been aiding the company’s overall performance over a considerable period of time. Notably, Medidata Clinical Cloud helps in connecting patients, physicians, and life sciences professionals.

Moreover, the company entered into an alliance with Cognizant to offer healthcare clients a comprehensive solution that leverage the market’s leading cloud platform with world-class business and technology services.

Additionally, the company’s continued focus on Research and Development (R&D) helps in instilling investor confidence. Per management, the current focus on drug pricing can turn out to be a positive. Lesser reliance on price is likely to drive focus on innovation, consequently bringing new therapies to the market.

The company continues to benefit from strategic buyouts to drive inorganic growth. Last month, the company entered into a definitive agreement to acquire SHYFT Analytics in a bid to integrate the leading platform for clinical development with the top platform for commercial and real-world data analytics.

Medidata Rave is a cloud-based clinical data management system used to electronically capture, manage, and report clinical research data. The company continues to gain market share on the back of RAVE.

What’s Deterring the Stock?

The market for clinical trial solutions is highly competitive. Consequently, intense competition in the niche space adds to concerns.

Moreover, Medidata faces substantial consolidation risks owing to the slew of acquisitions.

Which Way are Estimates Headed?

For 2019, the Zacks Consensus Estimate for revenues is pegged at $740.1 million, indicating an improvement of 16.4% from the year-ago period. The same for earnings stands at $1.83, suggesting growth of 7% from the year-ago reported figure.

Key Picks

Some better-ranked stocks from the broader medical space are Cardiovascular Systems, Inc. , Quidel Corporation (QDEL - Free Report) and Heamonetics Corporation (HAE - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cardiovascular Systems has an earnings growth rate of 33.3% for the fourth quarter of fiscal 2019.

Quidel Corporation has a long-term earnings growth rate of 25%.

Heamonetics has a long-term earnings growth rate of 13.5%.

Will you retire a millionaire?

One out of every six people retires a multimillionaire. Get smart tips you can do today to become one of them in a new Special Report, “7 Things You Can Do Now to Retire a Multimillionaire.”

Click to get it free >>


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Haemonetics Corporation (HAE) - free report >>

QuidelOrtho Corporation (QDEL) - free report >>

Published in