UPDATE: Stifel Starts Quintiles (Q) at Hold
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(Updated - October 14, 2016 10:18 AM EDT)
Stifel initiated coverage on Quintiles (NYSE: Q) with a Hold rating and a price target of $84. Analyst Shlomo H. Rosenbaum said wait for a better entry point.
"We expect the company’s valuation to reflect a blend of Contract Research Organization (CRO) multiples and Information Services multiples since the company was formed through the combination of those types of businesses. We assume the 50% weighting for Info Services will reflect the average valuation in the Info Services space, and the 50% for CROs will be a slight premium to the CRO space, consistent with longer-term historical trends. A blend of 2017 and 2018 P/E and EV/EBITDA multiples yields an $84 valuation – about 12% higher than today’s price, which makes the shares interesting, but not quite a Buy (we prefer closer to 20%). We would be looking for an entry point closer to $70, all else remaining equal," said Rosenbaum.
Shares of Quintiles closed at $75.70 yesterday.
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