PRA Health Sciences, Inc., a contract research organization, provides outsourced clinical development and data solution services to the biotechnology and pharmaceutical industries worldwide.
The last earnings update was 49 days ago.
Discounted Cash Flow Calculation for NasdaqGS:PRAH using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
PRA Health Sciences
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
NasdaqGS:PRAH DCF 1st Stage: Next 10 year cash flow forecast
Amount off the current price
PRA Health Sciences
is available for.
Share price is
vs Future cash flow value of
Current Discount Checks
PRA Health Sciences
to be considered undervalued it must be available for at least 20% below the
current price. Less than 40% is even better.
PRA Health Sciences's share price is below the future cash flow value, but not at a moderate discount (< 20%).
PRA Health Sciences's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
PRA Health Sciences's
is considered below, and whether this is a fair price.
Price based on past earnings
PRA Health Sciences's earnings available for a low price, and how does
this compare to other companies in the same industry?
PRA Health Sciences's earnings are expected to grow by 18.1% yearly, however this is not considered high growth (20% yearly).
PRA Health Sciences's revenue is expected to grow by 7.6% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
PRA Health Sciences's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
PRA Health Sciences
has a total score of
4/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
A company's financial position is much like your own financial position,
it includes everything you own
The boxes below represent the relative size of what makes up
PRA Health Sciences's finances.
The net worth of a company is the difference between its assets and liabilities.
PRA Health Sciences's short term (1 year) commitments are greater than its holdings of cash and other short term assets.
PRA Health Sciences's long term commitments exceed its cash and other short term assets.
This treemap shows a more detailed breakdown of
PRA Health Sciences's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Low level of unsold assets.
Debt is not covered by short term assets, assets are 0.8x debt.
Nearly all companies have debt. Debt in itself isn’t
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.
The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
TENURE AS CEO
Mr. Colin Shannon has been the Chief Executive Officer at PRA Health Sciences, Inc. since January 1, 2010 and its President since May 2007 and serves as its Chairman of the Board of Directors. Mr. Shannon served as Chief Operating Officer of PRA International since May 2007. Mr. Shannon joined PRA in 2007. He served as an Executive Vice President of Global Clinical Operations at Pharmaceutical Product Development Inc. (PPD) since July 7, 2004. Mr. Shannon joined PPD in 1995 and served for four years as Chief Operating Officer for its European operations. Previously, at Pharmaceutical Product Development Inc., he served as a Vice President, Global Clinical Operations and Chief Financial and Administrative Officer for International Operations as well as Executive Director and Chief Financial Officer for Europe. Prior to joining PPD, Mr. Shannon has more than 15 years of experience in a variety of financial and accounting positions in the utility industry and multimedia. He has been a Director of PRA Health Sciences, Inc. since January 1, 2010. He holds an Master's in business administration from City University in London and a certification as an accountant by the Association of Chartered Certified Accountants.
Colin's compensation has been consistent with company performance over the past year, both up more than 20%.
Colin's remuneration is about average for companies of similar size in United States of America.
Management Team Tenure
Average tenure and age of the
PRA Health Sciences
management team in years:
The average tenure for the PRA Health Sciences management team is over 5 years, this suggests they are a seasoned and experienced team.
Executive VP & Chief Scientific Officer
Vice President of Legal Affairs
Director of Public Relations & Corporate Communications
Vice President of Human Resources
Senior Vice President of Scientific Affairs
Executive Vice President of Business Development
Senior VP & Head of Project Management - EAPA
President of Strategic Solutions
Board of Directors Tenure
Average tenure and age of the
PRA Health Sciences
board of directors in years:
The tenure for the PRA Health Sciences board of directors is about average.
Should We Worry About PRA Health Sciences, Inc.'s (NASDAQ:PRAH) P/E Ratio?
View our latest analysis for PRA Health Sciences How Do I Calculate A Price To Earnings Ratio? … The formula for P/E is: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for PRA Health Sciences: P/E of 39.69 = $97.78 ÷ $2.46 (Based on the trailing twelve months to March 2019.) Is A High P/E Ratio Good? … The higher the P/E ratio, the higher the price tag of a business, relative to its trailing earnings.
Is PRA Health Sciences, Inc.'s (NASDAQ:PRAH) CEO Being Overpaid?
First, this article will compare CEO compensation with compensation at similar sized companies. … View our latest analysis for PRA Health Sciences How Does Colin Shannon's Compensation Compare With Similar Sized Companies? … I think that the total shareholder return of 85%, over three years, would leave most PRA Health Sciences, Inc.
Should You Investigate PRA Health Sciences, Inc. (NASDAQ:PRAH) At US$87.08?
It’s trading around 17% below my intrinsic value, which means if you buy PRA Health Sciences today, you’d be paying a reasonable price for it. … And if you believe the company’s true value is $104.69, then there isn’t much room for the share price grow beyond what it’s currently trading. … Will you have enough confidence to invest in the company should the price drop below its fair value?
Calculating The Fair Value Of PRA Health Sciences, Inc. (NASDAQ:PRAH)
by projecting its future cash flows and then discounting them to today's value. … We generally believe that a company's value is the present value of all of the cash it will generate in the future. … Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model
PRA Health Sciences (NASDAQ:PRAH) Shareholders Have Enjoyed A 88% Share Price Gain
One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price. … During three years of share price growth, PRA Health Sciences achieved compound earnings per share growth of 21% per year. … We don't think it is entirely coincidental that the EPS growth is reasonably close to the 23% average annual increase in the share price.
Is PRA Health Sciences, Inc.'s (NASDAQ:PRAH) 15% ROE Better Than Average?
Our data shows PRA Health Sciences has a return on equity of 15% for the last year. … One way to conceptualize this, is that for each $1 of shareholders' equity it has, the company made $0.15 in profit. … Return on Equity = Net Profit ÷ Shareholders' Equity
Is PRA Health Sciences, Inc.'s (NASDAQ:PRAH) CEO Pay Justified?
This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. … How Does Colin Shannon's Compensation Compare With Similar Sized Companies. … is worth US$7.2b, and total annual CEO compensation is US$6.0m.
Is It Too Late To Consider Buying PRA Health Sciences, Inc. (NASDAQ:PRAH)?
received a lot of attention from a substantial price increase on the NASDAQGS over the last few months. … With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price? … However, could the stock still be trading at a relatively cheap price
PRA Health Sciences, Inc., a contract research organization, provides outsourced clinical development and data solution services to the biotechnology and pharmaceutical industries worldwide. The company operates in two segments, Clinical Research and Data Solutions. The Clinical Research segment offers product registration services, including clinical trial management, project management, regulatory affairs, therapeutic expertise, clinical operations, data and programming, safety and risk management, biostatistics and medical writing, quality assurance, and late phase services. It also provides strategic solutions, such as embedded, functional services provider, staff augmentation, and custom-built development solutions, as well as commercialization services; and early development services for Phase I and Phase IIa studies, and bioanalytical analysis. The Data Solutions segment offers data, analytics, technology, and consulting solutions to the life sciences market. Its services include market intelligence services, such as targeting and compensation, and pharmaceutical audit suite services; consulting and services comprising brand analytics, managed markets, commercial effectiveness, and scientific studies/clinical hubs; and technology-enabled products and services. PRA Health Sciences, Inc. conducts clinical trials in the areas of pharmaceutical development, including oncology, immunology, central nervous system, inflammation, respiratory, cardio metabolic, and infectious diseases. The company was formerly known as PRA Global Holdings, Inc. and changed its name to PRA Health Sciences, Inc. in July 2014. PRA Health Sciences, Inc. was founded in 1976 and is headquartered in Raleigh, North Carolina.
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