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Shares of Cerner Corp. (CERN - Analyst Report) rose nearly 8% following the announcement of a multiyear partnership with Intermountain Healthcare. It was close to the 52-week high of $55.07.

Intermountain is a Utah-based non-profit health care provider. It has 22 hospitals, 185 clinics, a medical group comprising 1,000 physicians and a health plans division. The partnership agreement will implement Cerner’s electronic medical record and revenue cycle solutions across all of Intermountain's hospitals and clinics.

The partnership will also develop a new set of tools for a post-fee-for-service world in areas such as activity-based costing. As per the agreement, staffs from Cerner will relocate to Salt Lake City, Utah and work with Cerner Intermountain’s executives. The partnership is expected to generate more than $50 million in annual revenue to CERN.

Cerner reported a 14.3% rise in second-quarter 2013 earnings per share to 32 cents, meeting the Zacks Consensus Estimate. Net income rose 15.4% year over year to $112.9 million.

Revenues in the quarter rose 11.0% year over year to $707.6 million. However, it missed the Zacks Consensus Estimate of $724 million. The sales growth was at the lower end of Cerner’s earlier assumptions due to reduced volume of tech resale, which carries a lower margin.

For the third quarter of 2013, CERN forecasts sales in a band of $740 million–$770 million. Earnings per share, before share based compensation expense, are expected in the range of 35 cents to 36 cents. Cerner projects stock-based compensation costs to dilute second quarter earnings by about 2 cents to 3 cents.

For 2013, the company continues to forecast sales in the region of $2,950 million to $3,050 million. Earnings per share, before share-based compensation expense, are forecasted in the range of $1.40 and $1.42 (earlier $1.39 and $1.42). Cerner projects stock-based compensation costs to dilute earnings by about 8 cents to 9 cents.

Currently, Cerner carries a Zacks Rank #3 (Hold). Other medical information systems stocks that are worth a look include Streamline Health Solutions, Inc. (STRM - Snapshot Report) with a Zacks Rank #2 (Buy). These apart, we consider medical product stocks such as Alere Inc. (ALR - Snapshot Report) with a Zacks Rank #1 (Strong Buy) and Boston Scientific Corp. (BSX - Analyst Report) with a Zacks Rank #2 (Buy).

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