Medpace Holdings, Inc. Just Recorded A 5.6% EPS Beat: Here's What Analysts Are Forecasting Next

Medpace Holdings, Inc. (NASDAQ:MEDP) shareholders are probably feeling a little disappointed, since its shares fell 5.1% to US$342 in the week after its latest yearly results. Medpace Holdings reported US$2.1b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$12.63 beat expectations, being 5.6% higher than what the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Medpace Holdings

Following the latest results, Medpace Holdings' eleven analysts are now forecasting revenues of US$2.17b in 2025. This would be a satisfactory 2.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to reduce 6.1% to US$12.46 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$2.23b and earnings per share (EPS) of US$12.59 in 2025. The consensus seems maybe a little more pessimistic, trimming their revenue forecasts after the latest results even though there was no change to its EPS estimates.

The consensus has reconfirmed its price target of US$343, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on Medpace Holdings' market value. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Medpace Holdings analyst has a price target of US$400 per share, while the most pessimistic values it at US$296. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Medpace Holdings shareholders.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Medpace Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 2.9% growth on an annualised basis. This is compared to a historical growth rate of 20% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.1% annually. Factoring in the forecast slowdown in growth, it seems obvious that Medpace Holdings is also expected to grow slower than other industry participants.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Still, earnings per share are more important to value creation for shareholders. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Medpace Holdings analysts - going out to 2027, and you can see them free on our platform here.

You can also see our analysis of Medpace Holdings' Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.