The thesis

Medpace is a contract research organization delivering clinical development services to pharmaceutical clients. The company is experiencing 17.2% YoY revenue growth. Its gross margin is 28.76% and net margin is 17.67%, indicating strong profitability. The medium conviction score of 20/100 suggests some uncertainty around the company's prospects.

Why now

The risk-on rotation is underway, driving growth in companies like Medpace that benefit from increased demand for clinical research services. With a P/E of 33.8x, the market is pricing in significant growth expectations.

What to watch

Revenue growth acceleration or deceleration over the next quarter will be a key indicator of Medpace's prospects. The outcome of major trials in the GLP-1 & Metabolic Health space will also impact the company's business.

Key risks

Trial results and insurance coverage decisions can significantly impact Medpace's clients and thus its business. The high valuation multiples also pose a risk if growth expectations are not met.

Theme exposure