Zacks Investment Research Lowers Cerner (CERN) to Sell

Zacks Investment Research downgraded shares of Cerner (NASDAQ:CERN) from a hold rating to a sell rating in a report issued on Monday.

According to Zacks, “Cerner exited the fourth quarter on a mixed note. While earnings met the consensus mark, revenues lagged the same. The company continues to witness strong contributions from key areas like, Population Health, Revenue Cycle and IT Works. Strong international performance in the quarter is an added positive. Also, gains in Professional and Managed Services units buoy optimism. Cerner is likely to benefit from its EHR, EPR or EMR platforms that provide patient care in both acute inpatient and outpatient settings. On the flip side, the company’s Licensed Software and Subscriptions revenues saw a year-over-year decline in the quarter. In fact, management expects low software bookings to negatively impact total bookings in the upcoming quarter. Contraction in operating margins too adds to the woes. Furthermore, high long-term debt and competition in the global HCIT space are worrisome.”

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Several other brokerages also recently commented on CERN. BidaskClub upgraded shares of Cerner from a sell rating to a hold rating in a report on Wednesday, February 13th. Morgan Stanley downgraded shares of Cerner from an equal weight rating to an underweight rating and cut their price target for the company from $68.00 to $47.00 in a report on Thursday, February 28th. Two equities research analysts have rated the stock with a sell rating, six have assigned a hold rating and nine have issued a buy rating to the stock. Cerner currently has an average rating of Hold and an average price target of $67.00.

Shares of NASDAQ:CERN opened at $57.14 on Monday. The stock has a market cap of $18.59 billion, a P/E ratio of 25.86, a PEG ratio of 1.88 and a beta of 0.97. Cerner has a 12 month low of $48.78 and a 12 month high of $67.57. The company has a debt-to-equity ratio of 0.09, a quick ratio of 2.38 and a current ratio of 2.41.

Cerner (NASDAQ:CERN) last issued its quarterly earnings results on Tuesday, February 5th. The company reported $0.63 EPS for the quarter, beating the consensus estimate of $0.57 by $0.06. The company had revenue of $1.37 billion for the quarter, compared to the consensus estimate of $1.39 billion. Cerner had a net margin of 11.74% and a return on equity of 14.84%. The firm’s revenue was up 3.9% compared to the same quarter last year. During the same period in the prior year, the firm posted $0.58 EPS. On average, equities analysts forecast that Cerner will post 2.37 EPS for the current year.

Hedge funds have recently modified their holdings of the business. Adell Harriman & Carpenter Inc. lifted its position in shares of Cerner by 0.6% in the 4th quarter. Adell Harriman & Carpenter Inc. now owns 31,427 shares of the company’s stock worth $1,648,000 after purchasing an additional 200 shares during the period. Securian Asset Management Inc lifted its position in shares of Cerner by 0.7% in the 4th quarter. Securian Asset Management Inc now owns 34,031 shares of the company’s stock worth $1,785,000 after purchasing an additional 248 shares during the period. Griffin Asset Management Inc. lifted its position in shares of Cerner by 2.5% in the 3rd quarter. Griffin Asset Management Inc. now owns 10,400 shares of the company’s stock worth $670,000 after purchasing an additional 250 shares during the period. Armstrong Henry H Associates Inc. lifted its position in shares of Cerner by 2.4% in the 4th quarter. Armstrong Henry H Associates Inc. now owns 10,500 shares of the company’s stock worth $551,000 after purchasing an additional 250 shares during the period. Finally, Motley Fool Wealth Management LLC lifted its position in shares of Cerner by 0.5% in the 4th quarter. Motley Fool Wealth Management LLC now owns 50,414 shares of the company’s stock worth $2,644,000 after purchasing an additional 262 shares during the period. Institutional investors and hedge funds own 79.86% of the company’s stock.

About Cerner

Cerner Corporation provides health care information technology solutions and services in the United States and internationally. The company offers Cerner Millennium architecture, a person-centric computing framework, which includes clinical, financial, and management information systems that allow providers to access an individual's electronic health record (EHR) at the point of care, and organizes and delivers information for physicians, nurses, laboratory technicians, pharmacists, front- and back-office professionals, and consumers.

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