William Blair Upgrades Medpace, Sees ‘Strong Biotechnology Funding Environment’ – Tech Science| Tech Science

Medpace Holdings Inc (NASDAQ: MEDP) reported better-than-expected second-quarter earnings Monday afternoon.

The Analyst

Blair’s John Kreger upgraded Medpace from Market Perform to Outperform.

The Thesis

The company reported adjusted EPS of 67 cents on an ASC 605 basis in Q2, well above Kreger’s 39-cent estimate. (See the analyst’s track record here.) 

The beat came due due to better gross margins and higher revenue, the analyst said, naming the earnings beat, excellent bookings and guidance raise as the drivers behind William Blair’s upgrade. 

Medpace increased 2018 guidance and said it expects higher revenue by $39 million and earnings that are 65 cents per share higher on an ASC 605 basis, Kreger said. His estimate is similar, as as he expects $40 million higher revenue and a 60-65-cent EPS increase on an ASC 605 basis.

“We view the funding environment as an ongoing positive for all of the CROs, but particularly for Medpace given its larger exposure to smaller clients,” the analyst said. 

William Blair expects Medpace to perform well in the second half of the year and in 2019.

The Price Action

Medpace shares were rallying 31.2 percent to $61.76 at the time of publication Tuesday afternoon. 

Related Links:

Benzinga’s Top Upgrades, Downgrades For July 31, 2018

The Week Ahead In Biotech: Conferences, PDUFA Dates, Earnings And IPOs

Latest Ratings for MEDP

Date Firm Action From To
Jul 2018 Credit Suisse Maintains Outperform Outperform
Jul 2018 William Blair Upgrades Market Perform Outperform
Apr 2018 Mitsubishi UFJ Initiates Coverage On Neutral

View More Analyst Ratings for MEDP

View the Latest Analyst Ratings

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