MEDPACE : Opportunité ? Analyse d'une Action Explosive (2025)

Antoine CH

📈 Découvrez l'analyse complète de MEDPACE ! Est-ce l'action à ne pas manquer en 2025 ?   Dans cette vidéo, nous plongeons au cœur de Medpace Holdings, une entreprise CRO (Contract Research Organizations). Nous décryptons son modèle économique, ses performances financières et son potentiel de croissance pour les années à venir.  ⏱️ Sommaire de la vidéo : 0:00 Business 4:13 Fondamentaux 8:41 Valorisation 11:22 Analyse SWOT 14:31 J'achète l'action Medpace ?  Restez connecté et apprenez davantage : Ma dernière vidéo : https://youtu.be/zMKjSsE7oaI ▶️ Mon portefeuille d'actions : https://youtu.be/zMKjSsE7oaI 📖 Rejoignez ma communauté sur TikTok : https://www.tiktok.com/@antoine_pastime?_t=ZN-8xMX03z5RKA&_r=1 👋  Besoin d'un Accompagnement Personnalisé pour Vos Investissements ? 🚀 Atteignez vos objectifs financiers avec un coaching sur-mesure ! Que vous souhaitiez démarrer en bourse, optimiser votre portefeuille ou affiner votre stratégie, je suis là pour vous guider. Contactez-moi dès maintenant pour discuter de vos besoins :  📧 Mon Email : chapasantoine@gmail.com  Rejoignez la Communauté et Ne Manquez Aucune Analyse ! 🔔 Abonnez-vous à la chaîne pour ne rater aucune de mes prochaines analyses de portefeuille et conseils d'investissement : https://www.youtube.com/@antoinechapas/videos 👍 Laissez un pouce bleu si cette vidéo vous a été utile ! 💬 Partagez vos impressions et vos propres performances en commentaire ! Comment votre portefeuille a-t-il traversé cette semaine ?  #Medpace #AnalyseAction #Investissement #Bourse #Opportunité2025 #ActionExplosive #MarchéFinancier #Finance #CRO #Actions #WallStreet

Transcript

00:00Hi everyone, we're meeting today to analyze Medpace stock, which has lost 33% since its recent highs.

00:06And so today we are going to see if it is an opportunity or a danger and therefore an action to avoid.

00:11So we start directly with the presentation of the company.

00:14So Medpace, whose real name is Medpace Holdings Inc.

00:17It comes from the healthcare sector, its ticker is MEDP and it is listed on the Nasdaq.

00:23It was founded in 1992 by August Trundle who is still the CEO today.

00:28So there's skin in the game, he owns a huge amount of shares in the company.

00:33And its total market capitalization as of the time I'm shooting this video is $8.57 billion.

00:39At the business level, the company is a CRO, that is, Contract Research Organization.

00:45It is simply a company that will do clinical testing for pharmaceutical and biotechnology companies.

00:50who do not have the internal resources to do so or who decide to subcontract the Medpace company.

00:55It will provide full service as value, i.e. the entire testing phase of clinical trials,

01:02so from phase 1 to phase 4, and it will do it quickly.

01:05It does this quickly, in particular thanks to its internal integration,

01:08because it has more than 180 full-time scientists,

01:13which means that it does not really need to subcontract with other laboratories.

01:17So that reduces his costs and will increase his margins.

01:20It also has a large enough capacity to comply with the strict standards of the healthcare sector

01:26and it also has a focus on complex tests which is often avoided by competitors

01:32and which therefore gives it a premium position in relation to customers.

01:35Ultimately, with everything I've just told you, we realize that Medpace is actually more of a scientific company.

01:40rather than a commercial enterprise like its competitors.

01:43And that's what will differentiate it from other competitors who are much more focused on quantity than on the actual quality of the tests.

01:50Then, in terms of income, it will be paid before each key stage of a trial,

01:54that is, she will not wait years to receive payments,

01:57she will have them quite frequently.

01:59We also have 75% of our turnover coming from recurring clients who are involved in various projects.

02:05and knowing that a single project from phase 1 to phase 4 can take several decades.

02:11So it's super interesting because we have a company that can seem a bit cyclical at first glance.

02:16but which, thanks to its loyalty, potentially manages to generate recurring revenue.

02:21In terms of sales, we will have 31% of sales in oncology,

02:25so everything that is cancers, 26% in metabolism and 10% in cardiovascular.

02:31We will also have 80% of its sales distributed among small pharmaceutical and biotech companies.

02:37Then 15% of sales on medium-sized pharmaceutical and biotech companies

02:42and only 5% for large pharma and large biotech.

02:46Note that large pharma and biotech companies are much more interested in big competitors for the moment,

02:52which means that MedPay has focused much more on small and medium-sized businesses.

02:57Then at the level of its moat, it already has two essential advantages.

03:01Already its complete vertical integration as we said,

03:04which allows for better quality, better lead times, better loyalty and many other advantages.

03:09Which in turn leads to significant switching costs.

03:13But it also has a second advantage,

03:15it is his very specific expertise in areas which are complex,

03:18therefore often avoided by competitors and which therefore gives it strong confidence among customers

03:23and therefore intangible assets.

03:26Regarding barriers to exit from the CRO sector,

03:28We will have several major obstacles, including medical expertise which is required and important.

03:33We will also need strict regulatory certification,

03:37Not just any company can become CRO overnight.

03:40Then we will also have to create important relationships with customers,

03:44which is really the basis of MedPay and its competitive advantage.

03:49And it will also be necessary to launch very significant initial investments,

03:53particularly in infrastructure and laboratories for example.

03:56It can also be noted that recently,

03:58François Rochon and Terry Smith recently opened and strengthened positions in the MedPay company,

04:04knowing that these are two investors who are really focused on the quality of a business purchased at a fair price.

04:09So we're going to look at that now, particularly the fundamentals and the company's valuation.

04:14So we find ourselves on the MedPay company screener for its fundamentals.

04:18We can already see that all the boxes are checked in green, so that's really interesting,

04:21with in particular a growth in turnover over 10 and 5 years which is around 20%,

04:25it is very very important, with all the same 12% growth,

04:29so a little bit of a decrease over the last year.

04:32Free cash flow growth of 23 and 25.5%,

04:35so that's extremely high too, it's super interesting,

04:39with a growth in free cash flow which is higher than that of turnover,

04:43therefore potentially free cash flow margins which are increasing,

04:45we'll see about that later.

04:46Then we have a growth in free cash flow per share which is also extremely high,

04:5123% over 10 years, 29.9% over 5 years,

04:55and which therefore over 5 years is much stronger than the growth of free cash flow,

04:59which means that there are share buybacks,

05:01we will see it later too.

05:03In terms of gross margins, we do not have all the information,

05:05because MedPay is a company that has only been on the stock market since 2016,

05:09but suddenly at the level of its gross margin over 5 years,

05:11we were at 64% and today we are at 68%, increase in gross margin.

05:16An operating margin, similarly, increasing is greater than 20%,

05:19So that's great.

05:21A net margin also increased to over 19.3%,

05:25so that's great too.

05:26For its free cash flow margin, we also see that it is increasing,

05:29as I was saying earlier,

05:31so 17.5% over 10 years, 19% over 5 years,

05:35and there a very strong increase in the free cash flow margin,

05:37with almost 26% free cash flow margin,

05:40It's absolutely huge.

05:41Then at the level of these returns on investment,

05:44which I calculate with ROCE, but not with EBIT,

05:47but the free cash flow in the denominator,

05:49so much more interesting for me.

05:51We are on 10 years at 6.5%, it is relatively low,

05:55on the other hand, over 5 years we have had a very strong increase of 25.3%,

05:59and this year we were at 66%, it's absolutely enormous,

06:02and often that is a sign of a mode that is progressing, that is improving,

06:06so that's very interesting, potentially a MedPay company,

06:09which suddenly begins to progress, to take market share

06:12on its competitors, and to make a real no in the industry.

06:16At the level of these share buybacks, these outstanding shares,

06:20we have share issues over 10 years,

06:23and not buybacks, so that dilutes the shareholders,

06:25It's not very interesting, but it was still extremely weak,

06:27a minus 0.3%, moreover we see it on the free cash flow per share,

06:31which increases very slightly less quickly than free cash flow alone,

06:35and on the other hand, over 5 years, 3.4% per year of share buyback,

06:39This is absolutely huge, and the company continues to do so.

06:42at times that are interesting.

06:44We continue with the percentage of SBCs compared to free cash flow,

06:47so there continually decreasing, over 10 years they were at approximately 18%

06:51free cash flow, which is already quite low,

06:53but today we are at 4.5%, so it is really very low,

06:56It's very interesting, there is little SBC compared to free cash flow,

06:59and so this is a company that does not need to pay a lot of money

07:03its employees in SBC, so it's still quite comfortable for us investors.

07:08At the CAPEX level, we have figures that are quite sustainable,

07:11let's say 7.6% 10 years ago, 9.7% 5 years ago, and 6.4% at present,

07:17so we don't go over 10 and we don't go below 5,

07:20so it remains quite interesting, frankly I find that the CAPEX are very well controlled.

07:25At the level of the company's net debt compared to free cash flow,

07:2810 years ago we were at 6.8%, so a net debt which is extremely high,

07:33but on the other hand we have a net debt over 5 years which was negative,

07:36So that's very interesting, it means that the company is no longer in debt,

07:39and today we are at 0%, so also no longer in debt at all.

07:43So in the end a company that had a lot of debt and a lot of cash,

07:47which, thanks to this cash, managed to significantly reduce its debt until it had none left,

07:51and once it was no longer debt, it took the opportunity to buy back shares,

07:54so once again a very good allocation of capital.

07:57And finally, in terms of performance,

07:59so over 10 years we still won't have the information because the company has only been on the stock market since 2016,

08:04so not 10 years.

08:05On the 5-year performance we are at 29.4% per year,

08:09so it's well above the S&P 500 over that period,

08:13and on the other hand over a year we are at minus 24.6%,

08:16so it may have varied very slightly,

08:18here we are at minus 24.46%,

08:21but this year also minus 8.45%,

08:24so in the end a company which as we can see since its last peak has lost 31%,

08:29and at the time I saw it yesterday we were at minus 33%,

08:33so potentially a very interesting opportunity to seek out here,

08:38because as we have seen, MedPay is a very good quality company.

08:41We are now tackling the valuation of the company,

08:45so I entered the company ticker,

08:47its number of shares, its cash, its current debt,

08:49with also its current cash flow,

08:52and we will try to estimate it in the future with a price to free cash flow

08:55and free cash flow growth to achieve a purchase price.

08:59So here is my hypothesis,

09:01I assume that the price to free cash flow will be 18.

09:04Why 18?

09:05Today the price to free cash flow is at 17.2,

09:09so slightly below 18,

09:11and as we can see it's been more than 5 years

09:13that we therefore have figures which are extremely high,

09:16above 20, almost 30,

09:18and then we really went down again,

09:20This is the first time in five years that the company has fallen below 17.

09:25so a figure which is potentially very interesting.

09:28So before we were still in a company that was more indebted,

09:31who did not do share buybacks, etc.

09:33So that also explains the fact that the company didn't have as much

09:37from price to free cash flow,

09:38she was not valued as much,

09:41but so today put 18,

09:42knowing that she managed to reach a little below 18,

09:4617.65 in 2022,

09:48and so roughly the 15th, 16th in 2025,

09:52for me I still find it relatively interesting,

09:54knowing that the company is paying itself at somewhat discounted prices in my opinion,

09:58especially because there are financing problems for biotech,

10:02so that's still relatively very interesting,

10:04we will see it later.

10:05So if we go back to the valuation,

10:0718 from price to free cash flow,

10:09and it would only require a growth in free cash flow of 8% per year,

10:13to estimate a purchase price of 303 dollars,

10:16and attack the price where we are currently,

10:19that is to say approximately 306 dollars.

10:21So, if we estimate that the company instead,

10:23it achieves 10% growth in free cash flow,

10:25here we are more on 340 dollars,

10:28to achieve 13% performance per year, I remind you,

10:31so it's extremely interesting.

10:32If, on the other hand, we start with a much more optimistic hypothesis,

10:36where we suddenly have growth in free cash flow,

10:37so there which was at 23 and 25%,

10:39so we can put for example 16%

10:41and potentially a price to free cash flow going to 22,

10:46which would be a little more interesting for the company,

10:48so we would be looking at a purchase price of 553 dollars,

10:51and therefore an undervaluation of 80% all the same,

10:55so it seems crazy for a company of this size,

10:58but at the same time these are figures that she has already achieved in the past,

11:00so it would be possible.

11:01On the other hand, I prefer to be much more cautious in my investments,

11:04having a very large margin of error is much more interesting,

11:07and so I prefer to put 8% growth

11:10and 18% price to free cash flow

11:12to estimate a current purchase price of $303.

11:15So I remind you, this is not investment advice,

11:18This is my opinion,

11:19But anyway, that's what I think of the company right now.

11:22We're done with the fundamentals and the valuation,

11:25We now move on to the strengths and weaknesses of the company.

11:28So for these forces, we saw that she had solid experience,

11:30even its management which is experienced,

11:33and in particular it has a great capacity to have good loyalty

11:37and a good reputation,

11:38which is very important in the healthcare sector in general.

11:41On the other hand, in terms of its weaknesses,

11:43it is much smaller compared to its many competitors,

11:46it only has a 7% market share,

11:48so a mode that perhaps grows,

11:50but which is not huge either,

11:52it is not the leader in its market.

11:53It is also vulnerable to the capacity of financing

11:56biolibraries and pharmaceutical companies,

11:58as it was said at the moment,

11:59and since 2022, this is a little more the case,

12:01therefore potentially a slowdown in growth

12:04which was previously around 20%.

12:06There, we will be looking at slightly lower figures.

12:08The company expects growth of between 1.5 and 7%.

12:12of its turnover in 2025,

12:14so it remains correct and growth,

12:16but it's not the 20% we're used to.

12:19It should also be noted that the company is very dependent

12:20of the American market which represents 98% of its sales.

12:24It's huge.

12:25On the other hand, to put it into perspective all the same,

12:27Today, it represents 98% of its sales

12:29made by American companies,

12:31but who potentially sell products

12:33in emerging markets as well, for example.

12:35So in the end, we still end up with

12:37a certain diversification which is indirect.

12:40We now move on to opportunities and threats.

12:42So in terms of these opportunities,

12:43we will have an increase in expenses

12:45and requests for clinical trials,

12:47including annual growth in the CRO market

12:50which should be between 10 and 12% per year.

12:53This is extremely high.

12:54That's very interesting.

12:55If MedPay manages to grab a little bit of market share,

12:57we can imagine a growth in turnover

12:59at 12-14% per year.

13:01So that could be very interesting.

13:03We also have increasing complexity

13:05clinical tests and trials

13:06which will appear,

13:07with increasingly complex diseases to obtain,

13:10which represents an opportunity by MedPay,

13:12because it is very well positioned

13:15in this sector in particular,

13:17and its famous premium side a little bit

13:19This allows it to strongly attract customers

13:22who want complex tests

13:25with a well-reputed quality company.

13:28And finally, the third opportunity,

13:30it would obviously be emerging markets

13:31which will continue to grow at a higher rate

13:33to the CRO market as a whole.

13:36At the level of these threats,

13:37we will have potential growth

13:39at the competition level

13:40with players like Thermo Fisher,

13:42IGVIA,

13:42who are suddenly on this market

13:44for several years also,

13:45who also have some kind of good expertise

13:47and which can potentially cast a shadow

13:49to a company like MedPay,

13:50which does not hold again

13:52only 7% market share,

13:54so which is still quite low.

13:56We will also have

13:57potential regulatory changes,

13:59especially if it is in the United States for example,

14:01it could have a strong impact

14:02the benefits of the MedPay coup

14:04if they fail to adapt

14:06to these regulatory changes.

14:08And finally, the uncertainties

14:09on the financing capacity of customers,

14:12so it's the same thing

14:13than these weaknesses at present.

14:14If we suddenly have

14:15high interest rates,

14:17etc.

14:18and an uncertainty,

14:19for example, political, economic,

14:21and well the financing of biotech

14:22and pharmaceutical companies

14:23will be impacted,

14:24although they have a tendency

14:26on the rise in recent years.

14:27And so suddenly,

14:28it could be harmful

14:29MedPay's business.

14:30We therefore conclude this analysis

14:31by my conclusion.

14:32So MedPay is evolving in the sector

14:33CROs,

14:34a fast-growing market.

14:36It offers an ultra-comprehensive service,

14:38so from phase 1 to phase 4

14:39for its customers,

14:40in complex areas

14:41that she masters.

14:42Which allows it to retain customers,

14:44to get a good reputation

14:47and obviously get

14:48recurring revenue

14:49on different projects.

14:51It has fundamentals

14:52very solid,

14:53we saw it,

14:53it meets all my quality criteria

14:55and a valuation

14:56who in my opinion,

14:57at the present time,

14:57seems very reasonable to me.

14:59She may even be

15:00very undervalued

15:01at the present time

15:01as we have seen.

15:02And so with everything we have just seen,

15:03MedPay company seems to me

15:04very interesting.

15:05So I opened my first position

15:07of three actions,

15:08so at a price roughly

15:09of 300 dollars

15:10on MedPay action.

15:12And so it's a case to follow.

15:13on the next Friday videos

15:16where I will summarize for you

15:17what will happen

15:18to my wallet.

15:19In any case,

15:20I hope this video

15:21you will have liked.

15:21Tell me in the comments

15:22if you already have MedPay,

15:24if you are going to reinforce

15:25or if you simply wish

15:26that I analyze another action

15:27next week.

15:29We meet every Tuesday

15:30for a new action analysis.

15:31It was Antoine,

15:33Hello!

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