Medidata Earnings: 3 Things This Shareholder Will Be Watching

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Medidata Solutions offers cloud services to pharmaceutical companies. Can that lucrative niche continue to pay off for shareholders? Here's what to watch.

Transcript of Medidata Earnings: 3 Things This Shareholder Will Be Watching

  • Medidata Solutions Earnings: 3 Things to Watch
  • Short-Term Investors
  • Wall Street Expectations Revenue Q2: $81.9 million Full Year: $341.1 million Earnings per Share Q2: $0.18 Full Year: $0.75 Short-Term Investors
  • Before last quarter, Medidatas earnings had exceeded analyst expectations for five straight quarters. Over that time frame, the stock more than doubled. However, when the company failed to meet expectations in April, the stock slipped as much as 30%. Because it currently trades for 54 times trailing earnings, the stock will continue to move heavily based on how it performs versus Wall Street expectations. Short-Term Investors
  • Medium-Term Investors
  • Growing Customer Base Investors will be watching to see if more and more drug companies use Medidata to manage drug development logistics. Medium-Term Investors
  • Medidata has consistently added to its customer base by roughly 5% on a quarter-by-quarter basis. If the company can reach 440 total customers, investors will know that the company is still gaining traction with drug and life sciences companies. Medium-Term Investors
  • Long-Term Investors
  • Using multiple products The life sciences industry is only so big. Investors believe Medidata can continue growing revenues by offering add-on services. Long-Term Investors
  • For most of the history of the company, Medidatas Rave cloud system has accounted for most of the companys revenue. However, recently Medidata has started adding more add-on products that not only add value, but make switching costs very high for customers. If Medidata can grow its percentage of customers using more than one product to 54%, that would be a great sign for investors. Long-Term Investors