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Allscripts (MDRX) Beats on Earnings in Q3, Revenues Miss
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Allscripts Healthcare Solutions, Inc. (MDRX - Free Report) reported third-quarter 2016 earnings of 11 cents per share, a penny above the Zacks Consensus Estimate. The figure also improved from 10 cents in the year-ago quarter.
Revenues increased from $355 million in the year-ago period to $404 million. However this came below the Zacks Consensus Estimate of $415 million.
Quarter Details
Software delivery revenues in the quarter totaled $253 million on a GAAP basis and $262 million on a non-GAAP basis, reflecting an increase of 10% and 14%, respectively, year over year.
At the Client services segment, revenue totaled $140 million on a GAAP basis and $142 million on a non-GAAP basis, up 13% and 15%, respectively, year over year.
Gross margin was 42.3% on a GAAP basis and 47.6% on a non-GAAP basis compared with 43.3% and 46.4%, respectively, in the third quarter of 2015.
Total operating expenses, consisting of selling, general and administrative and research and development expenses, were $144 million, reflecting a 4% increase year over year. The increase in operating expense was due to higher expenses from the consolidation of Netsmart.
Financial Condition
As of Sep 30, 2016, total cash and cash investments were $77.3 million compared with $116.9 million as of Dec 31, 2015. During the nine-month period ended Sep 30, 2016, the company generated $185 million in cash from operations, marking a 44% increase year over year.
Allscripts provided financial guidance for the fourth quarter of 2016. The projections include non-GAAP revenue between $420 million and $435 million (based on sequential quarterly improvement for Standalone Allscripts and Netsmart), adjusted net EBITDA between $70 million and $80 million, and non-GAAP earnings per share between 14 cents and 16 cents per diluted share.
Zacks Rank & Key Picks
Currently, Allscripts has a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader medical space include Cardiovascular Systems Inc. , Exelixis, Inc. (EXEL - Free Report) and IDEXX Laboratories, Inc. (IDXX - Free Report) . Notably, IDEXX sports a Zacks Rank #1 (Strong Buy) and Exelis and Cardiovascular Systems carry a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.
Cardiovascular Systems represents a stellar one-year return of 68.2%. Notably, the company has an expected long-term growth rate of 22.5%.
Exelis has a stupendous one-year return of almost 152.9%. In the last reported quarter, the company registered an impressive earnings surprise of 40.74%.
IDEXX Laboratories represents a promising one-year return of 54.2%. The company has a long-term expected growth rate of almost 14.8%.
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Allscripts (MDRX) Beats on Earnings in Q3, Revenues Miss
Allscripts Healthcare Solutions, Inc. (MDRX - Free Report) reported third-quarter 2016 earnings of 11 cents per share, a penny above the Zacks Consensus Estimate. The figure also improved from 10 cents in the year-ago quarter.
Revenues increased from $355 million in the year-ago period to $404 million. However this came below the Zacks Consensus Estimate of $415 million.
Quarter Details
Software delivery revenues in the quarter totaled $253 million on a GAAP basis and $262 million on a non-GAAP basis, reflecting an increase of 10% and 14%, respectively, year over year.
At the Client services segment, revenue totaled $140 million on a GAAP basis and $142 million on a non-GAAP basis, up 13% and 15%, respectively, year over year.
Gross margin was 42.3% on a GAAP basis and 47.6% on a non-GAAP basis compared with 43.3% and 46.4%, respectively, in the third quarter of 2015.
Total operating expenses, consisting of selling, general and administrative and research and development expenses, were $144 million, reflecting a 4% increase year over year. The increase in operating expense was due to higher expenses from the consolidation of Netsmart.
Financial Condition
As of Sep 30, 2016, total cash and cash investments were $77.3 million compared with $116.9 million as of Dec 31, 2015. During the nine-month period ended Sep 30, 2016, the company generated $185 million in cash from operations, marking a 44% increase year over year.
ALLSCRIPTS HLTH Price, Consensus and EPS Surprise
ALLSCRIPTS HLTH Price, Consensus and EPS Surprise | ALLSCRIPTS HLTH Quote
Guidance
Allscripts provided financial guidance for the fourth quarter of 2016. The projections include non-GAAP revenue between $420 million and $435 million (based on sequential quarterly improvement for Standalone Allscripts and Netsmart), adjusted net EBITDA between $70 million and $80 million, and non-GAAP earnings per share between 14 cents and 16 cents per diluted share.
Zacks Rank & Key Picks
Currently, Allscripts has a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader medical space include Cardiovascular Systems Inc. , Exelixis, Inc. (EXEL - Free Report) and IDEXX Laboratories, Inc. (IDXX - Free Report) . Notably, IDEXX sports a Zacks Rank #1 (Strong Buy) and Exelis and Cardiovascular Systems carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Cardiovascular Systems represents a stellar one-year return of 68.2%. Notably, the company has an expected long-term growth rate of 22.5%.
Exelis has a stupendous one-year return of almost 152.9%. In the last reported quarter, the company registered an impressive earnings surprise of 40.74%.
IDEXX Laboratories represents a promising one-year return of 54.2%. The company has a long-term expected growth rate of almost 14.8%.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>