As I have pointed out previously, these reviews assume a buy and hold strategy for investing. In actual practice, I employ an ' active portfolio management ' approach, seeking to limit losses by selling losing investments quickly and seeking to preserve gains by targeted and partial sales of appreciating stocks. Certainly, the difference in strategy will affect overall performance, but for the ease of evaluation, I have chosen to continue to assume a 'buy and hold' approach for these reviews.
On August 8, 2006, I posted inVentiv Health (VTIV) on Stock Picks when the stock was trading at $29.88/share. VTIV closed at $31.00 on February 22, 2008 for a gain of $1.12 or 3.7% since posting.
On November 7, 2007, inVentiv announced 3rd quarter 2007 results . For the quarter, total revenues climbed 29% to $254.9 million compared to $197.8 million in the same quarter the prior year. GAAP income from continuing operations increased 38% to $14.1 million from $10.2 million the prior year. Adjusted diluted eps climbed 26% to $.43/share from $.34/share the prior year.
Reviewing the Morningstar.com "5-Yr Restated" financials , we can see that while revenue growth is intact, earnings dipped the latest twelve months to $1.31/share from $1.70/share in 2006. Free cash flow, while also positive, dipped to $32 million in the TTM from $79 million in 2006. The balance sheet remains solid.
Reviewing the 'point & figure' chart on VTIV from StockCharts.com , we can see that the price broke down in November, 2007, when the stock dipped from $42 down to $28/share. The stock is still 'struggling' and does not appear to be respecting the blue 'support line'.
With the satisfactory latest quarter, but with 12 month earnings lagging the prior year and the relatively weak chart,
INVENTIV HEALTH (VTIV) IS RATED A HOLD
$31.28 (02/26/08)
