Pro forma and "adjusted" numbers are just an unfortunate fact of life these days. I don't like 'em, but you can't hardly look at two or three companies and not have to make your peace with them. And normally the adjustments make a certain amount of sense, though you have to keep a close eye on them. Such is the case for inVentivHealth
So, what kind of quarter was it for inVentiv, which provides services like outsourced marketing, recruitment, and communications for the pharmaceutical space? Well, you can look at the bold-faced headlines -- revenue up 44%, operating income up 60%, and so on -- but I don't think that's the full picture.
See, the company didn't have that communications business in the year-ago period, and that chipped in more than $52 million this quarter. Strip that out and revenue growth was more of the "none" variety. Likewise on operating income: As I see the numbers, performance would have been down slightly on a year-over-year basis. Now none of this was hidden and the communications segment is a big part of the future. I just wish there would have been a bit more upfront discussion of "organic" performance.
And that shouldn't be construed as me not seeing potential for inVentiv. The sales pipeline looks pretty strong, and this is a company that does, or has done, business with top-notch and well-known companies like Bristol-Myers Squibb
Now for the negative: This company is vulnerable to cancellations and scale-backs. There's also competition from the likes of Quintiles and PDI
I'd keep a careful eye on organic growth here, but the valuation doesn't look too bad if inVentiv can continue to grow the business at a high teens/low-20s clip.
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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).