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athenahealth-ADP Launch Cloud-Based Payroll for Hospitals
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Headquartered in Watertown, MA, athenahealth Inc recently introduced cloud-based payroll and attendance services for small hospitals in collaboration with Automatic Data Processing (ADP), an American provider of human resources management software and services.
Meanwhile, the stock represents a negative year-to-date return of almost 41.7%, wider than the Zacks categorized Medical Information System sub-industry’s return of negative 27% and the S&P 500’s 8.2%. In fact, post the last quarter’s mixed performance, the company’s shares plunged 27.3%.
However, we are positive about the recent alliance with ADP. Notably, shares of athenahealth followed the lackluster market trend and dropped almost 2.7% to close at $93.83 following the news release. However, a long-term expected earnings growth rate of 26.67%, and a projected sales growth of 18.92%, compared to the industry’s 18.44% instills some confidence amongst investors.
Meanwhile, the estimate revision trend for the stock has been mixed as one estimate moved north and one moved south in the last two months. Notably, the current year estimate for the stock stands at 75 cents per share.
Coming back to the latest development, the companies would provide a highly exclusive cloud-based technology to streamline the erroneous tasks of organizing employee data, processing payroll and issuing the W-2 Tax forms.
Per management, easing out payroll and attendance services saves time, eliminates the chances of errors and reduces inefficiencies.
The joint venture also aims to strengthen employee self-service by integrating the ‘ADP Workforce Now’ and ‘athenaOne’ platforms to deliver seamless client experience.
Our Take
The latest development fortifies the company’s foothold in the cloud-based health solution market. In this regard, the global Healthcare Information Technology (HCIT) Market by product is expected to reach a worth of $228.7 billion by 2020, growing at a CAGR of 13.4% (Markets And Markets).
We are also upbeat about athenahealth’s unique business model, which makes it a strong niche provider of revenue cycle management (RCM) services to small physician practices.
Of the other recent developments, athenahealth had been added to Boston Globe’s 2016 list of "Top Places to Work" recently. The Boston Globe is an American daily newspaper based in Boston, MA.
On the flip side, low bookings rate, lack of enterprise-sized deals and intensifying competition in the health care and information technology (HCIT) market are major headwinds, at least in the near term.
Zacks Rank & Key Picks
Currently, athenahealth has a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader medical sector include Addus HomeCare Corporation (ADUS - Free Report) , LHC Group, Inc. and HMS Holdings Corp. . Addus HomeCare and LHC Group sport a Zacks Rank #1 (Strong Buy) while HMS Holdings carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Addus HomeCare has a long-term expected earnings growth rate of approximately 15%. Notably, the stock represents an impressive one-year return of 50.4%.
LHC Group has a long-term expected earnings growth rate of 15%. The company has returned almost 1.2% in the last one month.
HMS Holdings has an expected earnings growth of almost 14.3%. The company posted a promising year-to-date return of 46.7%.
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athenahealth-ADP Launch Cloud-Based Payroll for Hospitals
Headquartered in Watertown, MA, athenahealth Inc recently introduced cloud-based payroll and attendance services for small hospitals in collaboration with Automatic Data Processing (ADP), an American provider of human resources management software and services.
Meanwhile, the stock represents a negative year-to-date return of almost 41.7%, wider than the Zacks categorized Medical Information System sub-industry’s return of negative 27% and the S&P 500’s 8.2%. In fact, post the last quarter’s mixed performance, the company’s shares plunged 27.3%.
However, we are positive about the recent alliance with ADP. Notably, shares of athenahealth followed the lackluster market trend and dropped almost 2.7% to close at $93.83 following the news release. However, a long-term expected earnings growth rate of 26.67%, and a projected sales growth of 18.92%, compared to the industry’s 18.44% instills some confidence amongst investors.
Meanwhile, the estimate revision trend for the stock has been mixed as one estimate moved north and one moved south in the last two months. Notably, the current year estimate for the stock stands at 75 cents per share.
Coming back to the latest development, the companies would provide a highly exclusive cloud-based technology to streamline the erroneous tasks of organizing employee data, processing payroll and issuing the W-2 Tax forms.
ATHENAHEALTH IN Price
ATHENAHEALTH IN Price | ATHENAHEALTH IN Quote
Per management, easing out payroll and attendance services saves time, eliminates the chances of errors and reduces inefficiencies.
The joint venture also aims to strengthen employee self-service by integrating the ‘ADP Workforce Now’ and ‘athenaOne’ platforms to deliver seamless client experience.
Our Take
The latest development fortifies the company’s foothold in the cloud-based health solution market. In this regard, the global Healthcare Information Technology (HCIT) Market by product is expected to reach a worth of $228.7 billion by 2020, growing at a CAGR of 13.4% (Markets And Markets).
We are also upbeat about athenahealth’s unique business model, which makes it a strong niche provider of revenue cycle management (RCM) services to small physician practices.
Of the other recent developments, athenahealth had been added to Boston Globe’s 2016 list of "Top Places to Work" recently. The Boston Globe is an American daily newspaper based in Boston, MA.
On the flip side, low bookings rate, lack of enterprise-sized deals and intensifying competition in the health care and information technology (HCIT) market are major headwinds, at least in the near term.
Zacks Rank & Key Picks
Currently, athenahealth has a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader medical sector include Addus HomeCare Corporation (ADUS - Free Report) , LHC Group, Inc. and HMS Holdings Corp. . Addus HomeCare and LHC Group sport a Zacks Rank #1 (Strong Buy) while HMS Holdings carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Addus HomeCare has a long-term expected earnings growth rate of approximately 15%. Notably, the stock represents an impressive one-year return of 50.4%.
LHC Group has a long-term expected earnings growth rate of 15%. The company has returned almost 1.2% in the last one month.
HMS Holdings has an expected earnings growth of almost 14.3%. The company posted a promising year-to-date return of 46.7%.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>