Why Medidata Shares Soared
Apr 29th 2013 1:54PM
Updated Apr 29th 2013 3:00PM
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of clinical development software specialist Medidata Solutions surged 16% today after its quarterly results and guidance topped Wall Street expectations.
So what: Medidata's first-quarter results -- adjusted EPS of $0.35 on revenue of $63.3 million versus the consensus of $0.12 and $61.3 million -- and full-year outlook were so strong that analysts have no choice but to raise their growth estimates yet again. In fact, application services backlog spiked 46% from the year-ago period to $156 million, giving investors some decent visibility into upcoming quarters.
Now what: Management now sees full-year 2013 revenue of $270 million-274 million, up from prior guidance of $265 million-$270 million and nicely ahead of Wall Street's view of $267.2 million. "Life science companies are rapidly moving to the cloud and away from the legacy, on-premise solutions offered by our competitors," said CEO Tarek Sherif. "We expect to continue to be the primary beneficiary of this transition." Of course, with the stock now up a whopping 150% over the past year and trading at a 40-plus forward P/E, much of that optimism might already be baked into the valuation.
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The article Why Medidata Shares Soared originally appeared on Fool.com.Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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