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IQVIA Holdings (IQV) Stock Up 33.2% Year to Date: Here's Why

Zacks Equity Research

Shares of IQVIA Holdings Inc. IQV have gained 33.2% on a year-to-date basis, compared with 17.4% growth of the industry it belongs to and 27.3% increase of the Zacks S&P 500 composite.

 

Let’s delve deeper into the factors which have contributed to the company’s outperformance.

Consecutive Earnings & Revenue Beat

IQVIA Holdings reported better-than-expected earnings and revenue performance in the first three quarters of 2019. While the company’s bottom line continued to gain from operational efficiency, the top line performed well on the back of strength across all the segments namely Technology & Analytics Solutions, Research & Development Solutions and Contract Sales & Medical Solutions.

Updated 2019 Guidance

IQVIA Holdings has raised the lower end of its 2019 guidance for adjusted earnings per share and adjusted EBITDA.

The company now projects adjusted earnings between $6.30 and $6.40 per share compared with the previously guided range of $6.25-$6.45. Adjusted EBITDA is now anticipated in the range of $2,393-$2,407 million compared with the previously guided range of $2,385-$2,415 million.

Solid Technological Suite

IQVIA Holdings is gaining momentum from its solid technological suite. The company offers an extensive range of technology solutions in the form of cloud-based applications and related services. Its Software as a Service (“SaaS”) solution supports a vast range of clinical and commercial processes. By combining its database, healthcare expertise and therapeutic information collected from over 100 countries, the company creates its Global Market Insight offerings such as MIDAS, Analytics Link and Disease Insights.

All these solutions and services are used by healthcare and pharmaceutical companies to organize, enhance and implement their clinical and commercial strategies in a coordinated manner. It continues to secure notable awards and deals for its tech offerings from both new and old clients.

Growth Opportunities from Emerging Markets

IQVIA Holdings serves the life sciences industry (a major part of the global healthcare system) with the help of advanced analytics, technology solutions and contract research services. With its increasing presence in emerging markets, IQVIA Holdings should benefit from the evolving growth opportunities in the life sciences industry. Notably, the IQVIA Institute estimates that spending on pharmaceuticals in emerging markets will expand at a CAGR (compound annual growth rate) of 5% to 8% through 2023.

On the back of the expanding global healthcare system, the company is also hopeful of witnessing multiple acquisition opportunities across the industry. Life sciences organizations are also expected to commercialize their operations in emerging markets just as they did in developed markets.

Zacks Rank & Other Stocks to Consider

Currently, IQVIA Holdings carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the broader Zacks Business Services sector are Cardtronics CATM, Global Payments GPN and Mastercard Inc. MA. While Cardtronics sports a Zacks Rank #1 (Strong Buy), Global Payments and Mastercard carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term expected EPS (three to five years) growth rate for Cardtronics, Global Payments and Mastercard is 4%, 18% and 16%, respectively.

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