Parexel: Put on the Radar

PAREXEL International Corporation (PRXL)is a bio/pharmaceutical services company, providing a range of capability in clinical research, medical communications services, consulting, and informatics and technology products and services to the worldwide pharmaceutical, biotechnology, and medical device industries.

Its product and service offerings include clinical trials management, data management, biostatistical analysis, medical communications services, clinical pharmacology, patient recruitment, regulatory and product development consulting, health policy and reimbursement, industry training and publishing, medical imaging services, interactive voice response systems, clinical trial management systems, Web-based portals, systems integration, patient diary applications and other drug development services.

In September 2007, it completed the acquisition of Taiwan-based APEX International Clinical Research Co., Ltd., which was subsequently renamed as Parexel Apex International.

FUNDAMENTALS:

I'm surprised that Parexel hasn't received more attention over the years. This is a company that has posted substantial earnings growth in each of the past several years dating back to 2002, with the exception of 2005. Excellent earnings growth is expected to continue for at least the next 2 years according to analysts. Estimates call for a 28% earnings jump this year and 25% next year. While net margins aren't exceptional and not characteristic of a home-run stock at just 5%, they are above the industry average. Return on equity is much better at around 15%. Overall, this is a very good company fundamentally.

TECHNICAL:

PRXL has been in a long, steady uptrend for over 2 years now and isn't showing signs of slowing anytime soon. Given the fact that it has been so strong in a such a weak market is a testament to its strength. Having said that though, it's a bit extended so is risky at these levels. I would look to add shares on pull backs to near the 50 day moving average.

Full Disclosure/Disclaimer: I currently do not own a position in Parexel (PRXL).