Is Medpace (MEDP) Fairly Priced After Its Recent Pullback? A Fresh Look at Valuation

Medpace Holdings (MEDP) has pulled back about 6% over the past week and 8% this month, even after a strong year to date. That dip is prompting a closer look at the valuation setup.

See our latest analysis for Medpace Holdings.

Even after this sharp pullback, which includes a 1 day share price return of minus 5.5 percent and a 7 day share price return of minus 10.2 percent, Medpace’s 62.7 percent year to date share price return and hefty multi year total shareholder returns suggest momentum is cooling rather than breaking.

If Medpace’s run has you rethinking where the next leg of growth might come from, it could be worth scanning similar healthcare stocks that are also executing well.

With shares still up strongly this year yet now trading below some intrinsic value estimates, investors face a key question: Is Medpace finally offering a compelling entry point, or is the market already pricing in its next chapter of growth?

Most Popular Narrative: 1.2% Overvalued

Medpace’s narrative fair value of $538.25 sits slightly below the last close of $544.77, setting up a finely balanced valuation debate.

Despite strong topline growth, win rates for new business were down and backlog is declining (-1.8% year over year). This suggests competitive pressures and a lack of large contract wins may negatively impact future bookings and limit revenue and earnings visibility beyond 2025. The company is guiding for accelerated hiring in the back half of 2025 to support the faster pace of trials. Combined with higher investigator and salary costs, this could increase operating expenses faster than underlying EBITDA if productivity gains plateau or reverse, exerting pressure on net margins.

Read the complete narrative.

Curious how modest margin compression, steady double digit growth, and a lower future earnings multiple still combine to justify this price tag? The full narrative unpacks the math driving this call.

Result: Fair Value of $538.25 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent trial demand and operational efficiency gains could sustain growth and margins longer than expected, which could undermine the cautious overvaluation narrative.

Find out about the key risks to this Medpace Holdings narrative.

Another View: SWS DCF Points to Upside

While the narrative fair value says Medpace is slightly overvalued, our DCF model suggests the opposite, with a fair value of $674.85 versus the current $544.77, implying roughly 19 percent upside. If future cash flows hold up, is the market underestimating the long term story?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Medpace Holdings for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 907 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Medpace Holdings Narrative

If you see the story differently or want to dig into the numbers yourself, you can build a full narrative in just a few minutes: Do it your way

A great starting point for your Medpace Holdings research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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