PRA Health Sciences, Inc. (NASDAQ:PRAH) is well poised for growth on the back of strong international expansion, improving Contact Research Organization (CRO) industry and favorable biopharmaceutical industry dynamics.
The stock currently carries a Zacks Rank #2 (Buy).
Price Performance
Shares of PRA Health Sciences have gained 5.2%, against the industry’s decline of 16.9% on a year-to-date basis. Meanwhile, the S&P 500 Index rallied of 18.1% in the same timeframe.
Factors to Boost PRA Health
The CRO industry has been gaining traction of late on the back of worldwide increase in demand for outsourced clinical development solutions. Going by a CRO Market Size Projections report by Industry Standard Research (ISR), the size of the worldwide CRO market was approximately $32 billion in 2016 and is anticipated to hit $44 billion in 2021 at a CAGR of 7%.
International expansion has been and continues to be a major growth driver. This is because PRA Health is one of the largest CROs globally on the basis of revenues, focusing on executing clinical trials on a worldwide basis.
We note that, PRA Health’s revenues from international operations is growing fast (currently Europe, Africa, and Asia-Pacific region contributes more than 30% to total revenues).
The company continues to gain from large pharmaceutical companies, which contributed to the top line in recent times.
Moreover, a solid 2019 outlook instills optimism in the stock. For 2019, PRA Health anticipates to achieve total revenues between $3.02 billion and $3.10 billion, representing reported growth of 5-8% and 6-8% at constant currency.
Adjusted EPS for 2019 is expected between $4.98 and $5.08, indicating growth of 16% to 19% from 2018.
Which Way Are Estimates Headed?
For 2019, the Zacks Consensus Estimate for revenues is pegged at $3.06 billion, indicating an improvement of 9.3% from the year-ago period. For adjusted earnings per share, the same is pinned at $5.07, suggesting growth of 18.5% year-ago reported figure.
Other Stocks to Consider
Some other top-ranked stocks from the broader medical space are Nissan Chemical Corporation (OTC:NNCHY) , Straumann Holding AG SAUHF and McKesson Corporation (NYSE:MCK) , each currently carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Nissan Chemical has a long-term earnings growth rate of 10%.
Straumann Holding has a long-term earnings growth rate of 18%.
McKesson has a long-term earnings growth rate of 6.9%.
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Straumann Holding AG (SAUHF): Free Stock Analysis Report
PRA Health Sciences, Inc. (PRAH): Free Stock Analysis Report
McKesson Corporation (MCK): Free Stock Analysis Report
Nissan Chemical Industries, Ltd. (NNCHY): Free Stock Analysis Report
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