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Eclipsys Trading at a Premium
Eclipsys Corp (ECLP - Analyst Report) reported second-quarter EPS that were in-line with our estimate on revenue that exceeded our forecast. We increased our fiscal 2008/2009 revenue estimates. The management narrowed its fiscal 2008 revenue guidance and reiterated its non-GAAP EPS guidance for the year. The company continues to execute in driving higher revenue from new and existing customers, completing successful implementations, and improving margins.
At its current price of $23.31 per share, the shares are trading at roughly 39x our 2009 EPS estimate of $0.60, a premium to the group average multiple of roughly 30x. The stock is trading at a 1.7x P/E/G on 2009 EPS estimate, which is also at a premium to the group 1.2x P/E/G. In order to meet growth expectations, the company must continue to execute in terms of achieving a strong bookings mix in favor of higher margin products, improving professional services gross margin, and completing successful client implementations.
To stay competitive, ECLP introduced a clinical information solution called Sunrise Clinical Essentials in the first quarter that reduces implementation times and costs for clients and re-branded its Sunrise family of products as Sunrise Enterprise. At roughly a 1.8x P/E/G our 2009 EPS estimate, our target price moves to $25.
Read the full analyst report on ECLP
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| Market Summary | Sep 09, 2010 02:14 am ET |
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