Jefferies has raised its recommendation on Medpace (NASDAQ:MEDP) from Hold to Buy and assigned a price objective of $560.00, citing a clearer funding backdrop for biotechnology companies. At the time of the note, Medpace shares were trading at $416.04, and InvestingPro data flagged the stock as trading below its Fair Value even as the company retains a "GREAT" overall financial health rating.
The research firm pointed to what it described as a meaningful inflection in biotech funding in the second half of 2025, a development Jefferies says creates a more favorable operating environment for contract research organizations (CROs) such as Medpace. That improvement in funding, combined with Medpace's recent operating performance, underpins the analyst shop's upgraded stance.
Medpace has recorded robust top-line growth, with revenue rising 19.97% over the last twelve months to $2.53 billion. Jefferies emphasized the industry-observed 12-15 month lag between an improvement in funding and a rise in bookings, and said that timing places Medpace to benefit from accelerated bookings through the second half of 2026.
In its assessment, Jefferies also judged that the near-term risk posed by artificial intelligence to integrated, full-service CROs is limited, reducing a potential headwind for Medpace. The firm noted that Medpace's valuation has effectively reset to trough levels, and concluded the company's risk/reward profile is "skewed favorably" ahead of a possible demand and earnings inflection. Jefferies added that current company guidance is "conservatively assuming elevated cancellations."
Medpace's recent quarterly results provided additional support for a constructive view. For the fourth quarter of 2025 the company reported earnings per share of $4.67, above the consensus expectation of $4.18. Revenue for the quarter came in at $708.5 million, outpacing the anticipated $689.34 million.
Despite the quarter's upside, analyst responses have been mixed. Baird upgraded its rating on Medpace from Neutral to Outperform and set a $564.00 price target, citing potential upside tied to artificial intelligence. By contrast, BMO Capital trimmed its price target to $460.00 while keeping a Market Perform rating, even as it acknowledged results and guidance that beat expectations. Leerink Partners also lowered its target to $485.00, pointing to elevated cancellation rates in the fourth quarter as a concern.
Those divergent changes among the brokerage community reflect a range of views on how upcoming demand dynamics, cancellations and technology developments will affect Medpace's trajectory. For investors and market participants focused on biotech services, contract research and healthcare outsourcing, the combination of improving funding conditions and Medpace's recent operational results will be factors to monitor as bookings flow through the next two quarters and into 2026.