Value
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.7 |
| P/S | 6.2 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 4.1 |
| PEG | 3.4 |
| Analyst target | 3.0 |
- ▸Forward P/E: 29.7x
- ▸PEG: 3.43
MEDP · Why this verdict
Why Medpace Holdings (MEDP) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictHOLD
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Medpace has beaten consensus EPS estimates in each of the last four quarters, with an average positive surprise of roughly 7.6% — including beats of 10.5% and 8.2% in the two most recent periods — demonstrating disciplined, consistent-under-promising-and-over-delivering execution. Earnings | The beat streak extends to at least six consecutive quarters, with the average EPS surprise remaining above 5% over the next 12 months. | →Stable |
| CounterFour consecutive beats at a high average surprise rate tend to draw analyst estimates upward, resetting the bar at a level where sustaining the same outperformance rate becomes progressively more difficult; a surprise reversal at the higher bar could disproportionately pressure the stock. | ||
The business earns a return on equity of 77%, carries a wide economic moat, posts a Rule of 40 score of 45, and achieves an 8 out of 9 Piotroski score, collectively reflecting a high-quality franchise with durable competitive advantages and strong capital efficiency. Quality | Return on equity remains above 50%, the Rule of 40 stays above 35, and the Piotroski score holds at 7 or above over the next 12 months. | →Stable |
| CounterA return on equity of 77% is substantially flattered by a compressed equity base; the underlying return on capital is a more meaningful measure, and any contraction in the current 17% operating margin would disproportionately hurt the apparent ROE without signaling a change in competitive strength. | ||
Revenue has grown roughly 26% year over year, placing the company among the faster-growing businesses in its peer group and supporting continued reinvestment at high returns on capital. Growth | Revenue growth remains above 15% year over year for at least 2 of the next 4 quarters. | →Stable |
| CounterGrowth at this rate depends heavily on continued expansion of small biopharma clinical-trial spending, which is sensitive to biotech funding conditions; a tightening in capital availability for small biopharma clients could slow demand faster than consensus models assume. | ||
With a forward P/E of roughly 25 times earnings and a PEG ratio above 2.8, the stock already reflects substantial future growth in its price, and with approximately 0.5% headroom remaining to the analyst price target, the near-term risk/reward is unfavorable for initiating or adding to a position. Value | The forward P/E compresses to below 20 times over the next 12 months, either through earnings growth catching up or a price correction, creating a more attractive entry. | →Stable |
| CounterPremium multiples are often sustained for compounders with wide moats; if earnings continue to exceed expectations, the multiple may hold or re-rate higher even from current levels, making the valuation concern a persistently unresolved overhang rather than a near-term catalyst. | ||
Small biopharmaceutical companies account for approximately 82% of revenue, creating meaningful customer-base concentration; a slowdown in biopharma funding cycles or a shift in clinical outsourcing patterns within this segment would have an outsized impact on revenues. Bear case | Customer concentration in small biopharma falls below 70% of revenues as the company broadens its client mix over the next 12 months. | →Stable |
| CounterAt 82% concentration across a fragmented small-biopharma universe, the risk is distributed across many individual clients rather than a few large ones, limiting the impact of any single client's departure and partially offsetting the headline concentration figure. | ||
Medpace has beaten consensus EPS estimates in each of the last four quarters, with an average positive surprise of roughly 7.6% — including beats of 10.5% and 8.2% in the two most recent periods — demonstrating disciplined, consistent-under-promising-and-over-delivering execution.
→StableEarnings
- Expectation
- The beat streak extends to at least six consecutive quarters, with the average EPS surprise remaining above 5% over the next 12 months.
CounterFour consecutive beats at a high average surprise rate tend to draw analyst estimates upward, resetting the bar at a level where sustaining the same outperformance rate becomes progressively more difficult; a surprise reversal at the higher bar could disproportionately pressure the stock.
The business earns a return on equity of 77%, carries a wide economic moat, posts a Rule of 40 score of 45, and achieves an 8 out of 9 Piotroski score, collectively reflecting a high-quality franchise with durable competitive advantages and strong capital efficiency.
→StableQuality
- Expectation
- Return on equity remains above 50%, the Rule of 40 stays above 35, and the Piotroski score holds at 7 or above over the next 12 months.
CounterA return on equity of 77% is substantially flattered by a compressed equity base; the underlying return on capital is a more meaningful measure, and any contraction in the current 17% operating margin would disproportionately hurt the apparent ROE without signaling a change in competitive strength.
Revenue has grown roughly 26% year over year, placing the company among the faster-growing businesses in its peer group and supporting continued reinvestment at high returns on capital.
→StableGrowth
- Expectation
- Revenue growth remains above 15% year over year for at least 2 of the next 4 quarters.
CounterGrowth at this rate depends heavily on continued expansion of small biopharma clinical-trial spending, which is sensitive to biotech funding conditions; a tightening in capital availability for small biopharma clients could slow demand faster than consensus models assume.
With a forward P/E of roughly 25 times earnings and a PEG ratio above 2.8, the stock already reflects substantial future growth in its price, and with approximately 0.5% headroom remaining to the analyst price target, the near-term risk/reward is unfavorable for initiating or adding to a position.
→StableValue
- Expectation
- The forward P/E compresses to below 20 times over the next 12 months, either through earnings growth catching up or a price correction, creating a more attractive entry.
CounterPremium multiples are often sustained for compounders with wide moats; if earnings continue to exceed expectations, the multiple may hold or re-rate higher even from current levels, making the valuation concern a persistently unresolved overhang rather than a near-term catalyst.
Small biopharmaceutical companies account for approximately 82% of revenue, creating meaningful customer-base concentration; a slowdown in biopharma funding cycles or a shift in clinical outsourcing patterns within this segment would have an outsized impact on revenues.
→StableBear case
- Expectation
- Customer concentration in small biopharma falls below 70% of revenues as the company broadens its client mix over the next 12 months.
CounterAt 82% concentration across a fragmented small-biopharma universe, the risk is distributed across many individual clients rather than a few large ones, limiting the impact of any single client's departure and partially offsetting the headline concentration figure.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Medpace is a high-quality, fast-growing contract research business with consistent double-digit earnings beats and strong returns on capital, but the stock has essentially reached its analyst target with virtually no price headroom remaining, screens expensive at a forward P/E of roughly 25 times with a PEG above 2.8, and carries significant customer exposure to small biopharmaceutical clients representing over 80% of revenues.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 10.0 |
| Gross margin | 10.0 |
| Op margin | 8.0 |
| Net margin | 8.6 |
| Current ratio | 3.4 |
| FCF quality | 7.3 |
| Moat | 9.0 |
| Rule of 40 | 7.6 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 77%
- ▸Strong margins: 17%
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
Growth
7.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 9.1 |
| EPS growth | 5.3 |
- ▸Strong growth: 26% YoY
Momentum
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.1 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 0.3 |
- ▸Overbought (RSI 78)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
3.8/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 3.8 |
| Analyst rating | 5.0 |
| Price target | 2.4 |
- ▸Below analyst target
Insider
4.8/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| holder change | 5.1 |
- ▸Modest insider selling — $7,357,050 (0.046% of mkt cap)
Peer rank
5.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.2 |
| quality rank | 8.8 |
| growth rank | 7.5 |
- ▸Superior ROE vs peers
Technical
4.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.6 |
| support resistance | 1.3 |
| 52w position | 7.5 |
| gap | 6.0 |
Risk (lower is worse)
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.5 |
| days to cover | 2.8 |
| volatility | 3.2 |
| put call | 3.1 |
| implied vol | 5.4 |
| max pain risk | 3.0 |
| beta | 6.4 |
| debt equity | 9.0 |
| news risk | 5.0 |
- ▸Elevated put/call: 1.53
- ▸Above max pain $340
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 6.3 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (6)
- MOMENTUM:6.7>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:17d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-2.0=NEGATIVE
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-2.00
Upside
-30.1%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeCatalyst-Driven — Earnings in 17d with 4/4 beat streak
SuitabilityModerate — Balanced profile
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:6.7>=5.5. Top dim: Quality at 8.3; weakest: Value at 3.4. No conviction either direction.
The strongest dimensions are Quality at 8.3, Growth at 7.2, and Catalyst at 6.9; the weakest are Value at 3.4, Sentiment at 3.8, and Technical at 4.1. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -2.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Consistent Large Earnings Beats
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P2Compounder Quality Profile
Trip ifReturn on equity falls below 50% or Rule of 40 drops below 30 for 2 consecutive reporting periods.
- P3Strong Revenue Growth Trajectory
Trip ifRevenue growth decelerates below 15% year over year for 2 consecutive quarters.
- P4Rich Valuation At Analyst Target
Trip ifForward P/E compresses below 20 times earnings.
- P5Small Biopharma Customer Concentration
Trip ifSmall biopharma customer concentration falls below 70% of revenues.