West Pharmaceutical Services on Pace for Largest Percent Decrease Since April — Data Talk

As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the drug development inputs & services industry, including Medpace and its peers.

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 strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.9%.

Thankfully, share prices of the companies have been resilient as they are up 9.2% on average since the latest earnings results.

Best Q3: Medpace

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

Medpace reported revenues of $659.9 million, up 23.7% year on year. This print exceeded analysts’ expectations by 2.7%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ organic revenue estimates and a solid beat of analysts’ full-year EPS guidance estimates.

Medpace scored the fastest revenue growth but had the weakest full-year guidance update of the whole group. Unsurprisingly, the stock is up 13.4% since reporting and currently trades at $619.75.

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

UFP Technologies

With expertise dating back to 1963 in specialized materials and precision manufacturing, UFP Technologies 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 $154.6 million, up 6.5% year on year, outperforming analysts’ expectations by 3.3%. The business had a very strong quarter with an impressive beat of analysts’ revenue and EPS estimates.

The market seems happy with the results as the stock is up 11.5% since reporting. It currently trades at $221.97.

Is now the time to buy UFP Technologies? Access our full analysis of the earnings results here, it’s free for active Edge members.

Slowest Q3: Azenta

Serving as the guardian of some of medicine's most valuable materials, Azenta provides biological sample management, storage, and genomic services that help pharmaceutical and biotechnology companies preserve and analyze critical research materials.

Azenta reported revenues of $159.2 million, up 5.5% year on year, exceeding analysts’ expectations by 1.6%. Still, it was a slower quarter as it posted EPS in line with analysts’ estimates.

Interestingly, the stock is up 22.9% since the results and currently trades at $36.86.

Read our full analysis of Azenta’s results here.

IQVIA

Created from the 2016 merger of Quintiles (a clinical research organization) and IMS Health (a healthcare data specialist), IQVIA provides clinical research services, data analytics, and technology solutions to help pharmaceutical companies develop and market medications more effectively.

IQVIA reported revenues of $4.1 billion, up 5.2% year on year. This print topped analysts’ expectations by 0.5%. However, it was a mixed quarter as it failed to impress in some other areas of the business.

IQVIA delivered the highest full-year guidance raise but had the weakest performance against analyst estimates among its peers. The stock is up 4.7% since reporting and currently trades at $227.60.

Read our full, actionable report on IQVIA here, it’s free for active Edge members.

West Pharmaceutical Services

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

West Pharmaceutical Services reported revenues of $804.6 million, up 7.7% year on year. This number beat analysts’ expectations by 2.1%. Overall, it was a very strong quarter as it also recorded a solid beat of analysts’ full-year EPS guidance estimates and a beat of analysts’ EPS estimates.

The stock is flat since reporting and currently trades at $274.44.

Read our full, actionable report on West Pharmaceutical Services here, it’s free for active Edge members.

What Happened?

A number of stocks jumped in the afternoon session after comments from a key Federal Reserve official bolstered hopes for an interest rate cut. New York Federal Reserve President John Williams stated he sees “room for a further adjustment” in the near term, sparking a significant market rally. Following his remarks, the probability of the central bank cutting rates at its December meeting jumped from 39% to over 73%, according to the CME FedWatch tool. This positive sentiment provided relief to markets amid concerns over high valuations, particularly in AI-related stocks.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Senior Health, Home Health & Hospice company Option Care Health jumped 5%. Is now the time to buy Option Care Health? Access our full analysis report here, it’s free for active Edge members.
• Outpatient & Specialty Care company DaVita jumped 5%. Is now the time to buy DaVita? Access our full analysis report here, it’s free for active Edge members.
• Research Tools & Consumables company Revvity jumped 4.3%. Is now the time to buy Revvity? Access our full analysis report here, it’s free for active Edge members.
• Drug Development Inputs & Services company West Pharmaceutical Services jumped 5.1%. Is now the time to buy West Pharmaceutical Services? Access our full analysis report here, it’s free for active Edge members.
• Medical Devices & Supplies - Specialty company Bausch + Lomb jumped 4.6%. Is now the time to buy Bausch + Lomb? Access our full analysis report here, it’s free for active Edge members.

Zooming In On West Pharmaceutical Services (WST)

West Pharmaceutical Services’s shares are not very volatile and have only had 9 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 29 days ago when the stock gained 12.3% on the news that the company reported strong third-quarter 2025 results that surpassed analyst estimates and raised its full-year financial forecast. The company announced adjusted earnings of $1.96 per share on revenue of $804.6 million, beating Wall Street's expectations of $1.69 per share and $787.7 million, respectively. Sales grew 7.7% compared to the same period in the previous year. Bolstered by these results, West Pharmaceutical lifted its full-year 2025 guidance, raising the midpoint for sales to $3.07 billion and for adjusted earnings to $7.09 per share. The strong performance, particularly the significant earnings beat and improved outlook, reassured investors about the company's profitability and operational stability.

West Pharmaceutical Services is down 17.4% since the beginning of the year, and at $271.27 per share, it is trading 22% below its 52-week high of $347.87 from January 2025. Investors who bought $1,000 worth of West Pharmaceutical Services’s shares 5 years ago would now be looking at an investment worth $983.85.