IQVIA Holdings (IQV) Beats On Q2 Earnings, Updates '19 View

IQVIA Holdings Inc. (NYSE:IQV) reported solid second-quarter 2019 results wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.

Adjusted earnings per share of $1.53 beat the consensus mark by 4 cents and increased 18.6% on a year-over-year basis. The reported figure exceeded the guided range of $1.46-$1.51.

Total revenues of $2.74 billion outpaced the consensus estimate by $46.9 million and increased 6.7% year over year on a reported basis and 8.5% on a constant-currency basis. The reported figure exceeded the guided range of $2.66 billion- $2.71 billion.

So far this year, shares of IQVIA Holdings have gained 35%, outperforming the 21.7% rise of the industry it belongs to and 18.3% increase of the Zacks S&P 500 composite.

Let’s check out the numbers in detail

Segmental Revenues

Revenues from Technology & Analytics Solutions (TAS) totaled $1.10 billion, up 9% on a reported basis and 11.4% on a constant-currency basis. The segment accounted for 40% of total revenues.

Research & Development Solutions (R&DS) revenues of $1.44 billion increased 6.3% on a reported basis and 7.5% on a constant-currency basis. The segment contributed 52% to total revenues.

Revenues from Contract Sales & Medical Solutions (CSMS) totaled $203 million, down 1.5% on a reported basis but up 1% on a constant-currency basis. The segment accounted for 7% of total revenues.

Operating Performance

Adjusted EBITDA was $578 million, up 8.4% on a reported basis. Adjusted EBITDA margin increased to 21.1% from 20.8% in the year-ago quarter

Operating income was $197 million, up 15.9% from the year-ago quarter. Operating income margin increased to 7.2% from 6.6% in the year-ago quarter.

Total selling, general and administrative expenses of $436 million were up 2.8% from the year-ago quarter.

Balance Sheet and Cash Flow

IQVIA Holdings exited second-quarter 2019 with cash and cash equivalents balance of $938 million compared with $936 million at the end of the prior quarter. Long-term debt at the end of the quarter was $11.3 billion compared with $11.2 billion at the end of the first-quarter 2019.

The company generated $391 million of cash from operating activities in the reported quarter and spent $155 million on capex.

IQVIA Holdings repurchased shares worth $236 million during the reported quarter. As of Jun 30, 2019, the company had roughly $1.9 billion of share repurchase authorization remaining.

Q3 Guidance

For third-quarter 2019, IQVIA projects adjusted earnings per share in the range of $1.53-$1.59. The current Zacks Consensus Estimate of $1.60 is above the guided range.

Revenues are expected between $2.73 billion and $2.78 billion. The current Zacks Consensus Estimate of $2.75 billion falls within the guided range.

Adjusted EBITDA is anticipated in the range of $580-$595 million.

2019 Guidance

IQVIA Holdings updated its guidance for full-year 2019.

For the full year, the company now projects adjusted earnings between $6.25 per share and $6.45 per share compared with the previously guided range of $6.20-$6.40. The current Zacks Consensus Estimate of $6.34 lies within the guided range.

Revenues are now expected to be between $11.00 billion and $11.15 billion compared with the previously guided range of $10.9 billion and $11.13 billion. The current Zacks Consensus Estimate of $11.01 billionlies within the guided range.

Adjusted EBITDA is now anticipated in the range of $2,385 - $2,415 million compared with the previously guided range of $2,375-$2,425 million.

Zacks Rank & Upcoming Releases

Currently, IQVIA Holdings carries a Zacks Rank #3 (Hold). 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 second-quarter 2019 earnings of key players like Insperity (NYSE:NSP) , Waste Connections (NYSE:WCN) and Verisk Analytics (NASDAQ:VRSK) . While Insperity and Waste Connections are slated to report on Jul 29, Verisk Analytics is scheduled to release results on Jul 30.

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