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IQVIA (IQV) Surpasses Earnings and Revenue Estimates in Q1

Zacks Equity Research

IQVIA Holdings Inc. IQV reported solid first-quarter 2019 results wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.

Adjusted earnings of $1.53 per share beat the consensus mark by 2 cents and increased 14.2% on a year-over-year basis. Total revenues of $2.68 billion outpaced the consensus estimate by $22 million and increased 4.7% year over year on a reported basis and 7.2% on a constant-currency basis.

Shares of IQVIA have gained 14.1% over the past six months, significantly outperforming the 6.2% rally of the industry it belongs to.

 

Let’s check out the numbers in detail:

Segmental Revenues

Revenues from Technology & Analytics Solutions (TAS) totaled $1.08 billion, up 9.1% on a reported basis and 12.9% on a constant-currency basis. The segment accounted for 40% of total revenues.

Research & Development Solutions (R&DS) revenues of $1.42 billion increased 3.7% on a reported basis and 5.3% on a constant-currency basis. The segment contributed 53% to total revenues.

Revenues from Contract Sales & Medical Solutions (CSMS) totaled $193 million, down 9.4% on a reported basis and 7% on a constant-currency basis. The segment accounted for 7% of total revenues.

Profitability

Adjusted EBITDA came in at $587 million, up 7.3% year over year. Adjusted EBITDA margin increased to 21.9% from 21.3% in the year-ago quarter.

Balance Sheet and Cash Flow

IQVIA Holdings exited first-quarter 2019 with cash and cash equivalents balance of $936 million compared with $891 million at the end of the prior quarter. Long-term debt at the end of the quarter was $11.2 billion compared with $10.9 billion at the end of the fourth quarter.

The company generated $113 million of cash from operating activities in the reported quarter and spent $141 million on capex.

IQVIA Holdings repurchased $141 million of its shares from certain of its remaining private equity sponsors during the quarter.

Q2 Guidance

For second-quarter 2019, IQVIA projects adjusted earnings in the range of $1.46-$1.51 per share. The current Zacks Consensus Estimate is pegged at $1.49. Revenues are expected between $2,660 million and $2,710 million. The Zacks Consensus Estimate is pegged at $2,710 million.  Adjusted EBITDA is anticipated in the range of $575-$590 million.

2019 Guidance

For the full year, the company projects adjusted earnings between $6.20 per share and $6.40 per share. The Zacks Consensus Estimate is pegged at $6.34.Revenues are expected to be between $10,900 million and $11,125 million. The Zacks Consensus Estimate is pegged at $11,020 million. Adjusted EBITDA is anticipated in the range of $2,375-$2,425 million.

Zacks Rank & Upcoming Releases

Currently, IQVIA carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Investors interested in the broader Zacks Business Services sector are awaiting first-quarter 2019 earnings reports of key players like Aptiv APTV, S&P Global SPGI and CRA International CRAI. All of them are slated to report on May 2, before market open.

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