Investment management company Vulcan Value Partners recently released its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The firm does not focus on short-term outcomes, whether positive or negative, and believes it can enhance the potential long-term returns and reduce risk. In the quarter, the Large Cap Composite returned 7.0% net of fees and expenses, the Small Cap Composite returned 6.7% net, the Focus Composite returned 9.5% net, the Focus Plus composite returned 8.8% and the All-Cap Composite returned 8.1% net. For more information on the fund’s best picks in 2025, please check its top five holdings.
In its second quarter 2025 investor letter, Vulcan Value Partners highlighted stocks such as IQVIA Holdings Inc. (NYSE:IQV). IQVIA Holdings Inc. (NYSE:IQV) is an analytical technology services and clinical research-providing company to the life sciences industry. The one-month return IQVIA Holdings Inc. (NYSE:IQV) was -2.61%, and its shares lost 29.45% of their value over the last 52 weeks. On July 16, 2025, IQVIA Holdings Inc. (NYSE:IQV) stock closed at $158.64 per share with a market capitalization of $27.445 billion.
Vulcan Value Partners stated the following regarding IQVIA Holdings Inc. (NYSE:IQV) in its second quarter 2025 investor letter:
“We purchased two positions during the quarter: UnitedHealth Group Inc. and IQVIA Holdings Inc. (NYSE:IQV). IQVIA Holdings is a healthcare data and services company, commonly known as a contract research organization, or CRO for short. CROs are hired by sponsors ranging from large pharmaceutical companies to small biotech and medical device companies to support research, development and ultimately the commercialization of drugs, vaccines and devices. IQVIA was formed in 2016 through the merger of Quintiles and IMS Health. The merger combined the strong product development expertise of Quintiles with IMS’s rich data assets to support better outcomes for clients. Today, IQVIA is the largest CRO in the world. It works with more than 10,000 customers, including 100% of the top 25 largest pharmaceutical companies, and 75% of the top 80 small and mid-sized pharmaceutical companies. Its sheer size and scale can be seen in the fact that it has helped develop more than 70% of all FDA-approved drugs since its merger. IQVIA is led by a highly aligned and focused management team and Board. The company generates mid-to high single-digit earnings growth, trades at a high single-digit current free cash flow yield and is priced today at a healthy discount to our estimate of fair value.
There are a number of short-term challenges facing the CRO industry today, which has given us the opportunity to add IQVIA to our portfolio. We also own its smaller competitor Medpace. Large pharmaceutical clients have reprioritized and paused work in response to persistent inflation, higher interest rates, and policy uncertainty. Small biotech clients are experiencing a more difficult funding environment due to similar dynamics. Despite these challenges, IQVIA continues to make progress. The company has a current backlog of over $30 billion (this backlog is up over 25% over the last three years), a growing customer base, and is growing earnings. Additionally, the company will generate approximately $2 billion of free cash flow this year and is deploying that coupon both towards repurchasing shares and taking an opportunistic approach to M&A.”
A researcher in a lab with a microscope examining a sample.
IQVIA Holdings Inc. (NYSE:IQV) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 67 hedge fund portfolios held IQVIA Holdings Inc. (NYSE:IQV) at the end of the first quarter, which was 51 in the previous quarter. IQVIA Holdings Inc. (NYSE:IQV) reported first quarter revenue of $3,829 million, up 2.5% reported, 3.5% at constant currency. While we acknowledge the risk and potential of IQV as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than IQV and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered IQVIA Holdings Inc. (NYSE:IQV) and shared the list of most undervalued NYSE stocks to buy. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
