Wells Fargo Starts IMS Health Holdings (IMS) at Outperform

Wells Fargo initiated coverage on IMS Health Holdings (NYSE: IMS) with an Outperform rating and a price target of $26-$29.

Analyst Jamie Stockton said, "We are initiating coverage of IMS Health Holdings, Inc. with an Outperform rating and a 12-month valuation range of $26-29 based on an EV/EBITDA multiple of 11.5-12.5x our 2016 EBITDA est. of $982 million. IMS dominates the $3 billion market for providing pharmaceutical companies with data on market share across various drug classes and individual prescriber habits. Pharma views IMS as the only consistent global source for these insights. This Information business makes up an estimated 58% of revenue and should be relatively stable, although not high growth. For growth, management is looking to tap into the $47 billion of spend on software and services around its core prescription data, which should bolster Tech Services that is currently 42% of revenue. We believe the relationships IMS has with 5,000+ pharma companies on the Info side of its business can be leveraged significantly to grow a more robust Tech Services platform. We recommend purchase of these shares."

For an analyst ratings summary and ratings history on IMS Health Holdings click here. For more ratings news on IMS Health Holdings click here.

Shares of IMS Health Holdings closed at $25.21 yesterday.

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