Episode Details

IQVIA Holdings Inc. (IQV) Q2 2026 — Reported before the open on July 28 (calendar Q2 ended June 30, 2026). Revenue $4,368M (+8.7% YoY, +8.5% cc); adjusted EPS $3.15 vs $3.03 expected (+12.1%); GAAP diluted EPS $1.53 vs $1.54; adjusted EBITDA $994M (+9.2%); R&D Solutions net new bookings $3.15B (+19%, 1.22x book-to-bill); FY26 guidance raised. The stock closed $213.22 on July 27, jumped 13.9% to $242.94 on July 28, hit a 12-month closing high of $247.56 on July 29, and finished July 31 at $235.02. The line nobody printed: GAAP income from operations was $506M — against $506M a year ago. Exactly flat, on 8.7% revenue growth, because restructuring roughly doubled ($63M vs $32M) and stock-based compensation rose 58% ($95M vs $60M). GAAP diluted EPS actually FELL. THE CALL: AVOID (3/5, A REAL INFLECTION, ALREADY PAID FOR) — base-case value ~$190.0 vs ~$235.02 today. KEY METRICS: - CALL: AVOID 3/5 — fair value ~$190 vs $235.02 (-19%). Owner-earnings DCF: FY26E free cash flow ~$2.25B less ~$340M of stock compensation = $1.91B; grown 8%/yr for 5 years, then 4.5% for 5, 2.5% terminal, discounted at 8.25% = $192 (PV of 2027-2036 $17.99B + PV terminal $28.22B = EV $46.20B, less $14.09B net debt, / 167.3M diluted shares). Bear $109, bull $267; prob-weighted 25/50/25 = $190. STREET: Buy — 37 buy / 7 hold / 1 sell, 45 analysts; post-print targets $230-$288 (JPMorgan to $285 from $225, Baird to $287 from $252; TD Cowen, BofA, Barclays, BMO, Stifel, RBC and HSBC all lifted). We DIFFER and are more CAUTIOUS. - THE QUARTER WAS GENUINELY STRONG: revenue $4,368M (+8.7% reported, +8.5% cc) vs ~$4.30B consensus and above the high end of guidance. Commercial Solutions $1,793M (+8.6% reported, ~5% organic — the best in over a year); R&D Solutions $2,575M (+8.8% reported, 7% organic, +6.7% ex-reimbursed expenses). Company-wide organic growth ~6%. Adjusted EBITDA $994M (+9.2%), adjusted net income $527M, adjusted diluted EPS $3.15 (+12.1%). CEO Ari Bousbib: 'in over 25 years of reporting earnings... I've never had as clean a quarter as this one.' - THE BOOKINGS ARE THE STORY: R&DS net new bookings $3.15B, +19% YoY and the highest quarterly figure since 2022, for a 1.22x book-to-bill. LTM bookings $11.25B (+12.9%), rising four quarters in a row. Contracted backlog $34.2B at June 30, with ~$9.23B expected to convert to revenue in the next twelve months (+7.5%, a record). RFP flows up 'strong double digits'. Emerging-biopharma funding hit $35B in Q2, more than double a year ago; new drug launches up 45% in H1. - THE LINE NOBODY PRINTED: GAAP income from operations was $506M — identical to the $506M a year ago, on $351M more revenue. Cost of revenues +$239M, SG&A +$65M, D&A +$16M, restructuring $63M vs $32M. GAAP diluted EPS FELL to $1.53 from $1.54. Stock-based compensation rose 58% to $95M ($160M in H1 vs $132M); IQVIA has taken a restructuring charge every year for a decade. Adjusted EBITDA margin expanded just 10 basis points (22.65% to 22.76%) — 90bps of productivity offset by 80bps of pass-through revenue — and FY26 margin is guided FLAT at about 23.2%. - A THIRD OF THE EPS GROWTH IS THE BUYBACK: adjusted net income grew 8.4% ($527M vs $486M) but adjusted EPS grew 12.1% — the 3.7-point gap is the share count, with diluted shares down from 173.2M to 167.3M. IQVIA repurchased $398M in the quarter and $950M in H1 against H1 free cash flow of $851M (112% of the cash generated), while issuing $1,758M of new debt; cash fell from $1,980M to $1,909M. $2,819M of authorization remains. - THE BALANCE SHEET: total debt $15,999M against $1,909M of cash = $14,090M net debt, 3.59x LTM adjusted EBITDA ($3,921M) and 4.08x gross. Q2 interest expense $197M (from $182M) consumed 39% of GAAP operating income. Goodwill $16,604M plus other intangibles $4,749M is 72% of a $29,881M balance sheet against $6,301M of equity, so tangible book is deeply negative; purchase-accounting amortisation alone was $136M in the quarter. Offsetting that: Q2 operating cash flow $558M (+26%),