The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how drug development inputs & services stocks fared in Q4, starting with Medpace (NASDAQ: MEDP).

Companies specializing in drug development inputs and services play a crucial role in the pharmaceutical and biotechnology value chain. Essential support for drug discovery, preclinical testing, and manufacturing means stable demand, as pharmaceutical companies often outsource non-core functions with medium to long-term contracts. However, the business model faces high capital requirements, customer concentration, and vulnerability to shifts in biopharma R&D budgets or regulatory frameworks. Looking ahead, the industry will likely enjoy tailwinds such as increasing investment in biologics, cell and gene therapies, and advancements in precision medicine, which drive demand for sophisticated tools and services. There is a growing trend of outsourcing in drug development for nimbleness and cost efficiency, which benefits the industry. On the flip side, potential headwinds include pricing pressures as efforts to contain healthcare costs are always top of mind. An evolving regulatory backdrop could also slow innovation or client activity.

The 8 drug development inputs & services stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.5%.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 6.7% since the latest earnings results.

Best Q4: Medpace (NASDAQ: MEDP)

Founded in 1992 as a scientifically-driven alternative to traditional contract research organizations, Medpace (NASDAQ: MEDP) provides outsourced clinical trial management and research services to help pharmaceutical, biotechnology, and medical device companies develop new treatments.

Medpace reported revenues of $708.5 million, up 32% year on year. This print exceeded analysts’ expectations by 3.3%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ organic revenue estimates and an impressive beat of analysts’ full-year EPS guidance estimates.

Medpace scored the biggest analyst estimates beat and fastest revenue growth of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 14.5% since reporting and currently trades at $453.63.

We think Medpace is a good business, but is it a buy today? Read our full report here, it’s free.

West Pharmaceutical Services (NYSE: WST)

Founded in 1923 and serving as a critical link in the pharmaceutical supply chain, West Pharmaceutical Services (NYSE: WST) manufactures specialized packaging, containment systems, and delivery devices for injectable drugs and healthcare products.

West Pharmaceutical Services reported revenues of $805 million, up 7.5% year on year, outperforming analysts’ expectations by 1.5%. The business had a strong quarter with a solid beat of analysts’ full-year EPS guidance estimates and a beat of analysts’ EPS estimates.

The market seems content with the results as the stock is up 3.2% since reporting. It currently trades at $254.12.

Is now the time to buy West Pharmaceutical Services? Access our full analysis of the earnings results here, it’s free.

Slowest Q4: Fortrea (NASDAQ: FTRE)

Spun off from Labcorp in 2023 to focus exclusively on clinical research services, Fortrea (NASDAQ: FTRE) is a contract research organization that helps pharmaceutical, biotech, and medical device companies develop and bring their products to market through clinical trials and support services.

Fortrea reported revenues of $660.5 million, down 5.2% year on year, falling short of analysts’ expectations by 0.9%. It was a softer quarter as it posted full-year revenue guidance missing analysts’ expectations significantly and a significant miss of analysts’ EPS estimates.

Fortrea delivered the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update in the group. Interestingly, the stock is up 3.7% since the results and currently trades at $10.72.

Read our full analysis of Fortrea’s results here.

Charles River Laboratories (NYSE: CRL)

Named after the Massachusetts river where it was founded in 1947, Charles River Laboratories (NYSE: CRL) provides non-clinical drug development services, research models, and manufacturing support to pharmaceutical and biotechnology companies.

Charles River Laboratories reported revenues of $994.2 million, flat year on year. This result topped analysts’ expectations by 1.4%. Overall, it was a satisfactory quarter as it also logged a narrow beat of analysts’ revenue estimates.

The stock is up 12.6% since reporting and currently trades at $178.54.

Read our full, actionable report on Charles River Laboratories here, it’s free.

UFP Technologies (NASDAQ: UFPT)

With expertise dating back to 1963 in specialized materials and precision manufacturing, UFP Technologies (NASDAQ: UFPT) designs and manufactures custom solutions for medical devices, sterile packaging, and other highly engineered products for healthcare and industrial applications.

UFP Technologies reported revenues of $148.9 million, up 3.4% year on year. This number was in line with analysts’ expectations. More broadly, it was a satisfactory quarter as it also logged a beat of analysts’ EPS estimates but revenue in line with analysts’ estimates.

The stock is down 19.5% since reporting and currently trades at $193.75.

Read our full, actionable report on UFP Technologies here, it’s free.

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