Yahoo Finance ICON (ICLR) Q1 Earnings Surpass Estimates, Margins Expand
ICON plc ICLR delivered first-quarter 2024 adjusted earnings per share of $3.47, an increase of 19.7% from the year-ago period’s figure. The metric surpassed the Zacks Consensus Estimate by 0.9%.
Revenues
Total revenues in the first quarter rose 5.7% year over year to $2.09 billion. The metric surpassed the Zacks Consensus Estimate by 0.08%.
Gross business wins in the first quarter were $3.11 billion and cancellations were $460 million. This resulted in net business wins of $2.65 billion and a book-to-bill of 1.27.
Margins
The gross profit in the first quarter increased 6.2% year over year to $6.19 billion. The gross margin expanded 15-basis points (bps) year over year to 29.6%.
During the quarter, Selling, general and administrative expenses fell 11.3%.
The adjusted operating income in the quarter under review was $4.42 billion, increasing 15.3%. The adjusted operating margin expanded 177 bps to 21.1%.
Cash Position
ICON exited first-quarter 2024 with cash and cash equivalents of $396.1 million compared with $378.1 million at the end of fourth-quarter 2023. The company ended the first quarter with no debt on its balance sheet.
ICON PLC Price, Consensus and EPS Surprise
ICON PLC price-consensus-eps-surprise-chart | ICON PLC Quote
Cumulative cash flow provided by operating activities at the end of first quarter 2024 was $327.1 million compared to $175.5 million in the prior year’s comparable period.
Guidance
The company updated its full-year 2024 financial guidance:
Full-year 2024 revenues are now expected in the range of $8.48-$8.72 billion, suggesting growth of 4.4-7.4%. The Zacks Consensus Estimate for the same is pegged at $8.61 billion.
Full-year 2024 adjusted earnings per share are expected to be in the range of $14.65-$15.15, calling for growth of 14.5-18.5%. The Zacks Consensus Estimate for the same is pegged at $14.96.
Our Take
ICON ended the first quarter of 2024 on a solid note, with earnings and revenues beating the consensus estimate. The company is focused on delivering innovative clinical development solutions. ICON’s solid performance in the reported quarter reflects its efficient service delivery and strong cost control. Its strong performance is reflective of the current favorable demand trends across the industry and the further development of strategic customer partnerships.
The company had no debt obligation in its balance sheet, which looks encouraging. The expansion of both margins is an added advantage. The upbeat 2024 guidance instills optimism on the stock. However, stiff competition and foreign exchange continue to impact the company’s performance.
Zacks Rank and Key Picks
ICON currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are Inspire Medical Systems INSP, ICU Medical ICUI and Exact Sciences EXAS.
Inspire Medical Systems, sporting a Zacks Rank #1 (Strong Buy), reported a fourth-quarter 2023 EPS of 49 cents, beating the Zacks Consensus Estimate of a loss of 4 cents. Revenues of $192.5 million topped the consensus estimate by 0.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Inspire Medical Systems has an estimated earnings growth rate of 51.4% in 2024 compared with the industry’s 19.4%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average being 353.6%.
ICU Medical, carrying a Zacks Rank #1, reported a fourth-quarter 2023 adjusted EPS of $1.57, which surpassed the Zacks Consensus Estimate by 33.1%. Revenues of $587.9 million outpaced the Zacks Consensus Estimate by 4.1%.
ICUI has an estimated next-year earnings growth rate of 43.9% compared with the industry’s 25.3%. The company surpassed earnings estimates in each of the trailing four quarters, the average being 25.54%.
Exact Sciences, carrying a Zacks Rank #2, reported a fourth-quarter 2024 loss of 27 cents per share, narrower than the Zacks Consensus Estimate of a loss of 53 cents. Revenues of $646.9 million topped the Zacks Consensus Estimate by 2.4%.
EXAS has an estimated earnings growth rate of 23.9% in 2024 compared with the industry’s 13% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 51.5%.
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