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Medpace Holdings (MEDP)
NASDAQ:MEDP
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Medpace Holdings
(NASDAQ:MEDP)
69Neutral
Positive Factors
Earnings
EPS significantly exceeded expectations due to lower-than-expected income tax expense.
Financial Performance
Revenue of $559 million came in above our $530 million estimate, contributing to the top-line beat.
Negative Factors
Booking Performance
Bookings expectations were missed for the fifth consecutive quarter, leading to a downgrade based on a challenging macro environment and funding issues.
Book-to-Bill Ratio
The 0.90x book-to-bill ratio will likely grab the most attention given concerns about end market demand.
Market Environment
The challenging biotech funding and uncertain regulatory environment may lead to slower trial activity and more restricted biotech investment.
Medpace Holdings (MEDP) vs. S&P 500 (SPY)
Market Cap
$8.77B
Dividend YieldN/A
Average Volume (3M)639.57K
Price to Earnings (P/E)22.9
Beta (1Y)1.13
Revenue Growth9.87%
EPS Growth32.81%
CountryUS
Employees5,900
SectorHealthcare
Sector Strength60
IndustryMedical - Diagnostics & Research
Share Statistics
EPS (TTM)3.67
Shares Outstanding28,741,610
10 Day Avg. Volume745,219
30 Day Avg. Volume639,567
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.05
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit14.04
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$318.50Price Target Upside5.99% Upside
Rating ConsensusHold
Number of Analyst Covering7
Medpace Holdings Business Overview & Revenue Model
Company DescriptionMedpace Holdings, Inc. provides clinical research-based drug and medical device development services in North America, Europe, and Asia. It offers a suite of services supporting the clinical development process from Phase I to Phase IV in various therapeutic areas. The company also provides clinical development services to the pharmaceutical, biotechnology, and medical device industries; and development plan design, coordinated central laboratory, project management, regulatory affairs, clinical monitoring, data management and analysis, pharmacovigilance new drug application submissions, and post-marketing clinical support services. In addition, it offers bio-analytical laboratory services, clinical human pharmacology, imaging services, and electrocardiography reading support for clinical trials. The company was founded in 1992 and is based in Cincinnati, Ohio.
How the Company Makes MoneyMedpace Holdings generates revenue primarily through its clinical research services, which are contracted by pharmaceutical, biotechnology, and medical device companies seeking to conduct clinical trials. The company's revenue model is based on contracts with clients, where it charges fees for managing and executing different phases of clinical trials. These services include project management, clinical monitoring, data management, and regulatory affairs consulting. Medpace's growth is supported by its ability to maintain long-term relationships with clients, leveraging its expertise in complex therapeutic areas to secure repeat business. Additionally, the company benefits from the rising demand for outsourced clinical development services, driven by increased research and development spending in the healthcare sector.
Medpace Holdings Financial Statement Overview
Summary
Medpace Holdings exhibits strong financial health with robust growth in revenue and profitability. The company's zero debt position is commendable, although the negative total assets require further investigation. Cash flow metrics are strong, indicating excellent cash generation capabilities. Overall, Medpace Holdings is well-positioned in its industry.Income Statement
Medpace Holdings has demonstrated strong revenue growth, with a TTM (Trailing-Twelve-Months) total revenue increase of approximately 15% from the previous year. The gross profit margin remains robust at around 31.2%, and the net profit margin is healthy at 19.3%. The EBIT and EBITDA margins are also strong, indicating efficient operations. Overall, the income statement reflects solid growth and profitability trends.85
Very Positive
Balance Sheet
The company's balance sheet shows a strong equity position with a debt-to-equity ratio of 0, reflecting no leverage in the TTM period. Return on equity has improved to approximately 111.9%, demonstrating efficient use of shareholder equity to generate profits. However, the negative total assets in the TTM period is a concern that needs addressing, though it might be a reporting anomaly.75
Positive
Cash Flow
Medpace Holdings has shown positive cash flow trends, with a significant positive free cash flow and a strong operating cash flow to net income ratio of around 1.4 in the TTM period. The free cash flow to net income ratio is approximately 1.3, indicating good cash generation relative to earnings. These metrics suggest a strong cash flow position, supporting ongoing operations and potential growth initiatives.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.11B | 1.89B | 1.46B | 1.14B | 925.92M | Gross Profit |
| 656.30M | 524.50M | 432.44M | 328.15M | 278.73M | EBIT |
| 446.87M | 336.82M | 278.70M | 198.62M | 167.04M | EBITDA |
| 476.12M | 363.15M | 301.04M | 219.73M | 186.57M | Net Income Common Stockholders |
| 404.39M | 282.81M | 245.21M | 181.39M | 144.93M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 669.44M | 245.45M | 28.27M | 461.30M | 277.77M | Total Assets |
| 2.10B | 1.66B | 1.35B | 1.66B | 1.39B | Total Debt |
| 126.23M | 142.12M | 188.87M | 130.97M | 115.14M | Net Debt |
| -543.20M | -103.33M | 160.60M | -330.34M | -162.62M | Total Liabilities |
| 1.28B | 1.10B | 966.11M | 707.01M | 584.90M | Stockholders Equity |
| 825.54M | 558.95M | 386.39M | 952.93M | 805.78M |
| Cash Flow | Free Cash Flow | |||
| 572.27M | 396.73M | 351.17M | 235.06M | 227.34M | Operating Cash Flow |
| 608.82M | 433.37M | 388.05M | 263.33M | 258.68M | Investing Cash Flow |
| -28.31M | -34.63M | -38.74M | -31.36M | -31.21M | Financing Cash Flow |
| -154.01M | -182.64M | -775.77M | -44.45M | -82.28M |
Medpace Holdings Technical Analysis
Negative
300.49
Price Trends
312.08
Negative
327.82
Negative
341.34
Negative
Market Momentum
-2.14
Negative
48.40
Neutral
78.02
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MEDP, the sentiment is Negative. The current price of 300.49 is above the 20-day moving average (MA) of 296.85, below the 50-day MA of 312.08, and below the 200-day MA of 341.34, indicating a neutral trend. The MACD of -2.14 indicates Negative momentum. The RSI at 48.40 is Neutral, neither overbought nor oversold. The STOCH value of 78.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MEDP.
Medpace Holdings Risk Analysis
Medpace Holdings disclosed 37 risk factors in its most recent earnings report. Medpace Holdings reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Medpace Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $11.69B | 18.19 | 18.51% | 0.58% | 13.26% | 1.33% | |
69 Neutral | $8.77B | 22.93 | 65.82% | ― | 9.87% | 32.81% | |
68 Neutral | $11.76B | 24.08 | 25.33% | 0.56% | 11.21% | 30.38% | |
68 Neutral | $7.98B | 51.32 | 7.82% | 0.63% | 4.46% | -29.62% | |
64 Neutral | $11.55B | 15.56 | 8.01% | ― | -0.48% | 11.47% | |
58 Neutral | $5.82B | 465.65 | 0.45% | ― | -1.92% | -96.95% | |
52 Neutral | $5.35B | 3.83 | -41.61% | 2.85% | 17.10% | 1.22% |
* Healthcare Sector Average
Performance Comparison
MEDP
Medpace Holdings
300.49
-101.61
-25.27%
CRL
Charles River Labs
115.41
-120.89
-51.16%
RDY
Dr Reddy's Laboratories
13.51
-0.69
-4.86%
EHC
Encompass Health
116.31
31.03
36.39%
ICLR
Icon
143.02
-171.52
-54.53%
TECH
Bio-Techne
47.72
-29.40
-38.12%
Medpace Holdings Earnings Call Summary
Earnings Call Date:Apr 21, 2025
(Q1-2025)
| % Change Since: 3.98%|
Next Earnings Date:Jul 28, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. While there was notable growth in revenue and net income, the company faced significant challenges with declining net new business awards, elevated cancellations, and a decrease in EBITDA margin. The guidance for 2025 reflects these challenges, with potential for only modest growth.Q1-2025 Updates
Positive Updates
Revenue Growth
Revenue for the first quarter of 2025 was $558.6 million, marking a year-over-year increase of 9.3%.
Net Income Increase
Net income for the first quarter of 2025 was $114.6 million, an 11.7% increase compared to the prior year period.
Strong Cash Flow
The company generated $125.8 million in cash flow from operating activities during the first quarter.
Negative Updates
Decline in Net New Business Awards
Net new business awards decreased 18.8% from the prior year to $500 million, resulting in a net book-to-bill ratio of 0.9.
Backlog Challenges
Ending backlog as of March 31, 2025, was approximately $2.8 billion, a decrease of 2.1% from the prior year.
Increased Cancellations
Backlog cancellations were modestly elevated, and pre-backlog cancellations were significantly worse, impacting future projected backlog net awards.
Decreased EBITDA Margin
EBITDA margin for the first quarter was 21.2%, compared to 22.6% in the prior year period, impacted by employee-related costs and foreign exchange rates.
Company Guidance
During the Medpace Holdings, Inc. first quarter 2025 earnings call, the company provided guidance for the year, expecting total revenue to range from $2.14 billion to $2.24 billion, reflecting growth of 1.5% to 6.2% compared to 2024. The EBITDA is anticipated to be between $462 million and $492 million, representing a potential decline of 3.8% to growth of 2.5% from the previous year's EBITDA of $480.2 million. Net income is forecasted to be in the range of $378 million to $402 million, with an effective tax rate of 15.5% to 16.5%. Earnings per diluted share are projected to be between $12.26 and $13.04. The guidance assumes foreign exchange rates as of March 31, 2025, with no additional share repurchases included. The company's focus on the backlog is evident, with $1.61 billion expected to convert to revenue over the next twelve months, and they aim to achieve book-to-bill ratios above 1.15 in the latter half of the year, contingent on moderating cancellations and an improved business climate.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.