Waters (NYSE:WAT) and IQVIA (NYSE:IQV) Critical Analysis

IQVIA (NYSE:IQV) and Waters (NYSE:WAT) are both large-cap healthcare companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, analyst recommendations, valuation and profitability.

Risk & Volatility

IQVIA has a beta of 1.17, indicating that its stock price is 17% more volatile than the S&P 500. Comparatively, Waters has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500.

Earnings and Valuation

This table compares IQVIA and Waters”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IQVIA	$16.31 billion	2.70	$1.36 billion	$8.23	32.43
Waters	$3.17 billion	14.32	$642.63 million	$4.01	115.07

IQVIA has higher revenue and earnings than Waters. IQVIA is trading at a lower price-to-earnings ratio than Waters, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares IQVIA and Waters’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IQVIA	8.05%	30.02%	6.52%
Waters	3.58%	11.27%	6.73%

Insider and Institutional Ownership

89.6% of IQVIA shares are held by institutional investors. Comparatively, 94.0% of Waters shares are held by institutional investors. 1.7% of IQVIA shares are held by company insiders. Comparatively, 0.3% of Waters shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for IQVIA and Waters, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IQVIA	1	2	16	2	2.90
Waters	0	7	16	1	2.75

IQVIA presently has a consensus price target of $294.21, indicating a potential upside of 10.22%. Waters has a consensus price target of $457.50, indicating a potential downside of 0.85%. Given IQVIA’s stronger consensus rating and higher probable upside, analysts plainly believe IQVIA is more favorable than Waters.

Summary

IQVIA beats Waters on 10 of the 14 factors compared between the two stocks.

About IQVIA

IQVIA Holdings Inc. engages in the provision of advanced analytics, technology solutions, and clinical research services to the life sciences industry in the Americas, Europe, Africa, and the Asia-Pacific. It operates through three segments: Technology & Analytics Solutions, Research & Development Solutions, and Contract Sales & Medical Solutions. The Technology & Analytics Solutions segment offers a range of cloud-based applications and related implementation services; real world solutions that enable life sciences and provider customers to generate and disseminate evidence, which informs health care decision making and improves patients’ outcomes; and strategic and implementation consulting services, such as advanced analytics and commercial processes outsourcing services. This segment also provides country level performance metrics related to sales of pharmaceutical products, prescribing trends, medical treatment, and promotional activity across various channels, including retail, hospital, and mail order; and measurement of sales or prescribing activity at the regional, zip code, and individual prescriber level. The Research & Development Solutions segment offers project management and clinical monitoring; clinical trial support; strategic planning and design services; and patient and site centric solutions, as well as central laboratory, genomic, bioanalytical, ADME, discovery, and vaccine and biomarker laboratory services. The Contract Sales & Medical Solutions segment provides health care provider and patient engagement services, and scientific strategy and medical affairs services. It serves pharmaceutical, biotechnology, device and diagnostic, and consumer health companies. The company has a collaboration with argenx SE. The company was formerly known as Quintiles IMS Holdings, Inc. and changed its name to IQVIA Holdings Inc. in November 2017. The company is headquartered in Durham, North Carolina.

About Waters

Waters Corporation provides analytical workflow solutions in Asia, the Americas, and Europe. It operates through two segments: Waters and TA. The company designs, manufactures, sells, and services high and ultra-performance liquid chromatography, as well as mass spectrometry (MS) technology systems and support products, including chromatography columns, other consumable products, and post-warranty service plans. It also designs, manufactures, sells, and services thermal analysis, rheometry, and calorimetry instruments; and develops and supplies software-based products that interface with its instruments, as well as other manufacturers' instruments. In addition, the company offers MS technology instruments are used in drug discovery and development comprising clinical trial testing, the analysis of proteins in disease processes, nutritional safety analysis, and environmental testing. Further, the company provides thermal analysis, rheometry, and calorimetry instruments for use in predicting the suitability and stability of fine chemicals, pharmaceuticals, water, polymers, metals, and viscous liquids for various industrial, consumer good, and healthcare products, as well as for life science research. Its products are used by clinical, pharmaceutical, biochemical, industrial, nutritional safety, environmental, academic, and governmental customers working in research and development, quality assurance, and other laboratory applications. The company was founded in 1958 and is headquartered in Milford, Massachusetts.