UPDATE: Goldman Sachs Adds INC Research Holdings (INCR) to Conviction Buy List

August 12, 2016 6:48 AM EDT
Get Alerts INCR Hot Sheet
Price: $46.65 +3.67%

Rating Summary:
    8 Buy, 3 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 14 | Down: 19 | New: 11
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(Updated - August 12, 2016 8:27 AM EDT)

Goldman Sachs upgraded INC Research Holdings (NASDAQ: INCR) from Buy to Conviction Buy with a price target of $62, implying upside of 38%. Analyst Robert P. Jones sees upside helped by strong industry fundamentals.

"Following strong 2Q fundamental updates across the sector, we believe INCR screens attractive given we think valuation is not reflective of grouphigh growth and see upside to Street estimates under very reasonable assumptions (sensitivity analysis inside). We add Buy-rated INCR to the Americas Conviction List with a $62, 12-month price target (38% upside), which now includes an M&A component, and reiterate our Attractive coverage view on the CROs," said Jones.

"Specifically, we think now is the right time to get more positive on INCR due to: (1) Robust industry fundamentals – 2Q group net bookings were up 14% (INCR 15.8%); (2) group TTM book-to-bill stands at a healthy 1.24x (INCR 1.25x); and (3) stabilizing-to-improving conversion rates (INCR +10bps seq," continued the analyst.

Jones added, "Also, despite some investor skepticism around biotech investments, we believe funding remains at healthy levels – biotech equity funding (IPO/Converts) remains above 15 year historical averages and quarterly VC flows into biotech companies remain near peak levels in 2Q16."

For an analyst ratings summary and ratings history on INC Research Holdings click here. For more ratings news on INC Research Holdings click here.

Shares of INC Research Holdings closed at $45.01 yesterday.

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