ICLR - Syneos Health hits a 52-week low after Jefferies downgrade

The shares of Syneos Health (NASDAQ:SYNH) have recorded the worst intraday performance in over two years to reach a 52-week low after Jefferies downgraded the life sciences company to Hold from Buy citing risks to 2022 guidance. Supporting the thesis, the analysts led by David Windley point out that the company’s weak 4Q core bookings can hurt its 2022 clinical revenue growth, and the company is overly exposed to CMD biotechs where there is a growing risk of cuts to development expenditure. The firm estimates Syneos (SYNH) generates ~18% of its Clinical revenue from "Commercial" CMD biotech (nearly 15% of total revenue) compared to ~10% of ICON (ICLR) and ~7% of Iqvia's (IQV) total revenue. Citing one-time revenue and cost benefits in 2021, Jefferies highlights a challenging outlook for margins. The analysts point out that the EBITDA margin was 80 bps lower last year and, therefore, the 2022 margin target

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Syneos Health hits a 52-week low after Jefferies downgrade