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what it is
Icon runs clinical trials for drug and device companies so those clients do not have to build the machinery themselves.
how it gets paid
Last year Icon made $8.3B in revenue. Late-stage clinical trials was the main engine at $3.24B, or 39% of sales.
what just happened
Last quarter, Icon posted $3.31 in EPS and edged past the $3.30 consensus, which is the smallest kind of beat but still a beat.
At a glance
B+ balance sheet — decent shape, but not bulletproof
revenue recognition review — reported EPS is provisional until the probe closes
7.1x trailing p/e — the market's not buying it — or you found a deal
9.0% return on capital — nothing to write home about
$13.50 fy2027 eps est
xvary composite: 58/100 — below average
What they do
Icon runs clinical trials for drug and device companies so those clients do not have to build the machinery themselves.
Drug companies hire Icon because building a global trial machine yourself is slow and expensive. Icon has 41,900 employees and supports Phase I through IV studies, which means your client can hand over one messy process instead of juggling five vendors. The stickiness here is outsourced development services (clients pay someone else to run the trial work) → less hassle for customers → repeat business matters.
How they make money
$8.3B
annual revenue
Late-stage clinical trials
$3.24B
Early-stage clinical trials
$1.49B
Functional service provision
$1.74B
Consulting and data services
$0.91B
Laboratory and site support
$0.91B
The products that matter
runs outsourced clinical trials
Clinical trial management
core of the $8.3B revenue base
this is the business. drugmakers pay icon to plan, monitor, and execute studies, and that work supports the full $8.3B revenue line shown on this page.
core revenue engine
supports drug development programs
Development support services
20.0% operating margin
the service mix produces a 20.0% operating margin. That is solid for outsourced research work, but it is not software math.
margin matters
serves device and biotech clients
Broad client exposure
$2.9B long-term debt
client breadth matters because a company carrying $2.9B in long-term debt benefits from diversified project work. Segment revenue is in the rows above; client-level concentration is not broken out here.
detail is thin
Key numbers
7.1x
trailing p/e
P/E (price-to-earnings ratio) → what you pay for each dollar of profit → you are paying a distressed multiple for a business still expected to earn $13.50 by 2027.
$2.9B
long-term debt
Debt → borrowed money → with 29% of capital funded by debt, Icon has less room for mistakes while it works through an accounting review.
20.0%
operating margin
Operating margin → profit before interest and taxes on each sales dollar → Icon keeps $0.20 from every $1 before financing costs.
$118
18-month target
Target price → one firm's estimate of fair value over 18 months → that is 27% above the $93 stock price, but only if the reporting issue stays contained.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 35 / 100
- long-term debt $2.9B (29% of capital)
- net profit margin 13.3% — keeps 13 cents of every dollar in revenue
- return on equity 10% — $0.10 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in ICLR 3 years ago → it's now worth $3,910.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
Last quarter, Icon posted $3.31 in EPS and edged past the $3.30 consensus, which is the smallest kind of beat but still a beat.
Revenue was about $2.043B in the quarter, according to the company result cited in market coverage. The problem is contrast: a 1-cent beat does not matter much when investors are focused on a review covering revenue recognition from 2023 through 2025.
$2.04B
revenue
$3.31
eps
20.0%
operating margin
the number that mattered
The key number was the 0.3% EPS beat, because it shows the core business is still producing, even while the market cares far more about what gets restated.
-
the probe relates to revenue recognition from 2023 through 2025.
-
while the investigation into its financial reporting is ongoing, the clinical research organization said preliminary indications are that revenues were overstated by less than 2% in 2023 and 2024.
-
this could well have a profit-lowering impact for each of those years.meanwhile, icon withdrew its 2025 guidance, but expects to report fourth-quarter and full-year 2025 results, which have been delayed due to the probe, on or before april 30th.
-
iclr sank 40% in price before recovering some.
-
our estimates are tenuous.for much of 2025, difficult operating conditions, namely elevated cancellations, delayed customer decisions, and macro uncertainty, hurt the business.
source: company earnings report, 2025
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What could go wrong
the top risk is the accounting investigation and the litigation orbit around it. For a business with 90/100 earnings predictability, that kind of credibility hit matters more than it would at a naturally chaotic company.
high
internal accounting investigation
The audit committee initiated an internal investigation disclosed on Feb 12, 2026. If prior results need revisions, the market will stop treating 7.1x earnings as a bargain and start treating it as a warning label.
this risk hits credibility first, valuation second, and client trust after that.
high
securities litigation overhang
A securities fraud investigation surfaced on Feb 13, 2026. Even if the business keeps running, legal noise can drag on sentiment and keep institutions waiting for cleaner facts.
you are not just underwriting earnings now. You are underwriting cleanup time.
med
flat outlook keeps the stock cheap
The fy2027 revenue estimate is $8B versus a current $8.3B revenue base, and price stability is only 35 / 100. If growth does not return, a low multiple can stay low for a long time.
this is the business risk beneath the legal story: no re-rating without cleaner demand and cleaner numbers.
You are looking at an $8.3B revenue company with $2.9B of long-term debt and a stock already down from $204 to $93. There is some valuation cushion. There is not much trust cushion.
source: institutional data · regulatory filings · risk analysis
Pay attention to
next report
next earnings language on the investigation
You need two things at once: cleaner audit language and proof the $8B fy2027 revenue setup still holds.
risk
whether the internal review stays contained
An internal investigation can end as a footnote or expand into a thesis breaker. That distinction matters more than any short-term price bounce.
valuation
7.1x earnings versus $13.50 fy2027 eps
That is the mismatch. If the earnings power survives, you have upside. If the earnings quality does not, the low multiple explains itself.
trend
whether underperformance finally stops
Three-year total return took $10,000 down to $3,910 while the index reached $13,880. You want that gap to stop widening before you call this washed out.
Analyst rankings
earnings predictability
90 / 100
in human-speak, this used to be the kind of business where the numbers were not the drama.
price stability
35 / 100
the operating model may be steadier than the stock. Your tape is telling you trust has not healed.
source: institutional data
Institutional activity
253 buyers vs. 240 sellers in 3q2025. total institutional holdings: 70.7M shares.
source: institutional data
Price targets
3-5 year target range
$65
$170
$93
current price
$118
target midpoint · +27% from current · 3-5yr high: $180 (+95% · 18% ann'l return)
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