IQVIA Holdings Inc (IQV)

Conclusion

IQVIA Holdings Inc provides clinical research services, commercial insights and healthcare intelligence to the life sciences and healthcare industries. At 278.84 USD on 9 November 2026, the market capitalisation is 45.95 billion USD.

The verdict is fair. Earnings multiples sit below their ten-year medians: the P/E is 32.96 against a median of 43.27, a premium of -23.8%, and EV/EBITDA is 16.64 against 19.81. The price-to-book ratio of 6.90 is above its median of 5.71. The DCF gives 197.28 USD per share at a discount rate of 10.72%. The fair value band runs from 218.16 to 327.24 USD with a midpoint of 272.70 USD, a margin of safety of -2.2% at today's price. The fair value from historical multiples is 348.12 USD. The reverse DCF implies growth of 12.68%, against revenue growth of 7.5% a year over five years and free cash flow per share growth of 11.41%.

Free cash flow conversion of 149.1% on a trailing basis, eight earnings beats out of eight, and a five-year share count change of -2.31% support the case. The weakest numbers are net debt to EBITDA of 3.86, interest coverage of 3.03 and a current ratio of 0.83. A downward revision to next year's earnings estimate, at -1.64% over 90 days, would weaken the case further.

Financial health

The colour of financial strength is yellow, because none of the four measures is assessed as good and all four are neutral. The current ratio is 0.83, the quick ratio 0.74, net debt to EBITDA 3.86, debt to equity 2.45 and interest coverage 3.03 on a trailing basis. The Altman Z-score of 2.32 sits in the grey zone; the Altman model was designed for manufacturers, and IQVIA is a services company. Insolvency risk: low, about 2.2% by the estimate of the Ohlson model over one to two years. The company's leverage, rather than its liquidity or cash generation, is the main pressure point.

Earnings quality

The colour of earnings quality is green, supported by free cash flow conversion, a negative share count trend and the Beneish result. Trailing free cash flow conversion is 149.1%, and the five-year average is 155.4%. The accrual ratio is -4.55%, which means cash earnings exceed reported earnings. Stock-based compensation is 1.75% of revenue, and free cash flow after it is 1.776 billion USD. The five-year share count change of -2.31% indicates net buybacks. The Piotroski score is 5 out of 9, and the Beneish M-score of -2.55 is read as unlikely to signal manipulation. The company beat earnings estimates in all eight of the last quarters, with an average surprise of 1.25%. Estimate revisions for next year are negative: nine analysts lowered their estimates in the last 30 days against two who raised them.

Profitability

The colour of profitability is yellow: one measure is good and three are neutral. The operating margin of 13.42% is above its ten-year median of 9.73%, while the gross margin of 26.46% is well below its median of 34.53%. The net margin is 8.05% against a median of 7.27%. ROIC is 9.77% against a WACC of 8.99%, a neutral ROIC minus WACC value of 0.77%. The five-year median ROIC is 9.44%. The DuPont split explains the high return on equity: a net margin of 8.34%, an asset turnover of 0.5447 and an equity multiplier of 4.6046 give a trailing return on equity of 20.93%. Most of that return comes from leverage, not from margin or asset efficiency.

Growth

The colour of growth is green, because three of four measures are good and revenue growth is neutral. Revenue compound growth is 4.21% over three years, 7.50% over five years and 11.01% over ten. Earnings per share grew 11.05% a year over three years, 40.52% over five years and 9.78% over ten. Free cash flow per share compounded at 12.42% over three years, 11.41% over five and 14.09% over ten. Revenue has grown in all ten of the last ten years. Recent growth is slower than the ten-year rate, and the five-year earnings figure is lifted by a strong base period.

Valuation

The colour of valuation is yellow, because the single valuation measure is neutral. Against their ten-year medians, the P/E is 32.96 against 43.27 (premium -23.8%), EV/EBITDA 16.64 against 19.81 (premium -16.0%), P/FCF 22.10 against 27.63 (premium -20.0%), and P/S 2.65 against 2.90 (premium -8.6%). Price to book is 6.90 against 5.71, a premium of 20.8%. The DCF gives 197.28 USD per share at a discount rate of 10.72%, with 50.4% of the value coming from the terminal value. The fair value band runs from 218.16 to 327.24 USD with a midpoint of 272.70 USD, a margin of safety of -2.2%. The fair value from historical multiples is 348.12 USD. The fair value band is an order-of-magnitude estimate built on fixed assumptions, not a price target. The reverse DCF implies growth of 12.68%, above revenue growth of 7.5% and free cash flow per share growth of 11.41% over five years. The company pays no dividend, so the forward yield is 0.

Risks

The main risk is leverage. A net debt to EBITDA of 3.86 and interest coverage of 3.03 leave limited room if earnings fall, and a debt to equity ratio of 2.45 adds to the pressure. A current ratio of 0.83 means short-term obligations exceed short-term assets, so the company relies on continuing cash generation. A gross margin of 26.46% against a median of 34.53% suggests that operating profit depends on cost control. If the next-year estimate revisions continue downward, the growth priced into the stock becomes harder to deliver. About half of the DCF value sits in the terminal value, so the DCF is sensitive to long-run assumptions. The company does not report a debt maturity schedule or revenue by segment, so this analysis cannot test refinancing timing or the mix of growth across business lines.