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Inovalon (INOV) Q4 Earnings In Line, Revenue Beat Estimates
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Inovalon Holdings, Inc. (INOV - Free Report) reported fourth-quarter 2016 adjusted earnings (excluding special gains, charges and tax items) of 2 cents per share, which came in line with the Zacks Consensus Estimate. However, earnings deteriorated from 12 cents reported in the year-ago quarter.
Adjusted net sales were $96.1 million, down from $120.6 million in the year-ago quarter. However, net sales exceeded the Zacks Consensus Estimate of $95.0 million.
Stock Performance
The price performance of the stock has been unfavorable in the last three months. Inovalon registered a negative return of 28.53%, underperforming the Zacks classified Computer-IT Services sub-industry’s gain of almost 8.04%.
Quarter Details
In fourth-quarter 2016, Inovalon launched INDICES – a flexible, cloud-based data and analytics visualization platform for providers to support value-based care initiatives.
As of Dec 31, 2016, the MORE2 Registry dataset contained more than 150 million unique patients and 13 billion medical event counts, up 15.3% and 20.8%, respectively, from Dec 31, 2015.
Inovalon's trailing 12-month Patient Analytical Month (PAM) count grew to a record 26.4 billion as of Dec 31, 2016, implying an increase of 23.1% on a year-over-year basis.
Meanwhile, Inovalon’s investments supporting innovation in advanced, cloud-based data analytics and data-driven intervention platforms totaled $21.1 million, or 22% of revenues in the reported quarter.
Operating expenses rose 3.5% to $97.6 million, primarily driven by higher sales & marketing expenses, which accounted for 7.7% of total revenues compared with 5.4% of total revenue in the year-ago quarter.
General and Administrative expenses decreased 2.9% year over year to $32.1 million. However, this was partially offset by a 57.9% year-over-year rise to $8.1 million in research and development (R&D) expenses.
Sales and marketing expense in the fourth quarter was $7.4 million, or 7.7% of revenue, up from 6.7% of revenue in the prior quarter and 5.4% of revenue in the prior-year period. R&D expense was $8.1 million or 8.4% of revenue, up from 7.1% of revenue and 4.3% of revenue on the same basis.
Adjusted EBITDA in fourth-quarter 2016 was $14.3 million or 14.9% of total revenues. However, this compared unfavorably with 30% in the year-ago quarter.
Financial Condition
As of Dec 31, the company had $573 million of cash, cash equivalents and short-term investments. For full-year 2016, Inovalon generated $92.8 million of cash from operations, up 37% from $67.6 million in 2015, representing 21.7% of revenue compared with 15.8% last year. In 2016 the company repurchased 7.5 million shares for approximately $106 million. This leaves approximately $94 million available under share repurchase authorization through the end of 2017.
Outlook
For full-year 2017 the company affirmed revenue guidance in the range of $440.5–$455.0 million. Similarly net Income is expected to be between $19.5 million and $24.0 million. Adjusted EBITDA is forecasted to be between $105.2 million and $112.5 million. Finally, adjusted earnings per share are expected to be between 28 cents and 31 cents.
Currently, Inovalon carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader medical sector include Glaukos Corporation (GKOS - Free Report) , Avinger, Inc. (AVGR - Free Report) and Fluidigm Corporation . Notably, Glaukos and Fluidigm sport a Zacks Rank #1 (Strong Buy) while Avinger carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Glaukos Corporation has a long-term expected earnings growth rate of approximately 25%. Notably, the stock represents an impressive one-year return of 176.2%.
Avinger projects sales growth of 30.7% for the current year. Additionally, the company posted a positive earnings surprise of 27% in the last quarter.
Fluidigm Corporation has a long-term expected earnings growth rate of 25%. The stock has added 8.4% over the last one year.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>
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Inovalon (INOV) Q4 Earnings In Line, Revenue Beat Estimates
Inovalon Holdings, Inc. (INOV - Free Report) reported fourth-quarter 2016 adjusted earnings (excluding special gains, charges and tax items) of 2 cents per share, which came in line with the Zacks Consensus Estimate. However, earnings deteriorated from 12 cents reported in the year-ago quarter.
Adjusted net sales were $96.1 million, down from $120.6 million in the year-ago quarter. However, net sales exceeded the Zacks Consensus Estimate of $95.0 million.
Stock Performance
The price performance of the stock has been unfavorable in the last three months. Inovalon registered a negative return of 28.53%, underperforming the Zacks classified Computer-IT Services sub-industry’s gain of almost 8.04%.
Quarter Details
In fourth-quarter 2016, Inovalon launched INDICES – a flexible, cloud-based data and analytics visualization platform for providers to support value-based care initiatives.
As of Dec 31, 2016, the MORE2 Registry dataset contained more than 150 million unique patients and 13 billion medical event counts, up 15.3% and 20.8%, respectively, from Dec 31, 2015.
Inovalon's trailing 12-month Patient Analytical Month (PAM) count grew to a record 26.4 billion as of Dec 31, 2016, implying an increase of 23.1% on a year-over-year basis.
Meanwhile, Inovalon’s investments supporting innovation in advanced, cloud-based data analytics and data-driven intervention platforms totaled $21.1 million, or 22% of revenues in the reported quarter.
Operating expenses rose 3.5% to $97.6 million, primarily driven by higher sales & marketing expenses, which accounted for 7.7% of total revenues compared with 5.4% of total revenue in the year-ago quarter.
General and Administrative expenses decreased 2.9% year over year to $32.1 million. However, this was partially offset by a 57.9% year-over-year rise to $8.1 million in research and development (R&D) expenses.
Sales and marketing expense in the fourth quarter was $7.4 million, or 7.7% of revenue, up from 6.7% of revenue in the prior quarter and 5.4% of revenue in the prior-year period. R&D expense was $8.1 million or 8.4% of revenue, up from 7.1% of revenue and 4.3% of revenue on the same basis.
Adjusted EBITDA in fourth-quarter 2016 was $14.3 million or 14.9% of total revenues. However, this compared unfavorably with 30% in the year-ago quarter.
Financial Condition
As of Dec 31, the company had $573 million of cash, cash equivalents and short-term investments. For full-year 2016, Inovalon generated $92.8 million of cash from operations, up 37% from $67.6 million in 2015, representing 21.7% of revenue compared with 15.8% last year. In 2016 the company repurchased 7.5 million shares for approximately $106 million. This leaves approximately $94 million available under share repurchase authorization through the end of 2017.
Outlook
For full-year 2017 the company affirmed revenue guidance in the range of $440.5–$455.0 million. Similarly net Income is expected to be between $19.5 million and $24.0 million. Adjusted EBITDA is forecasted to be between $105.2 million and $112.5 million. Finally, adjusted earnings per share are expected to be between 28 cents and 31 cents.
Inovalon Holdings, Inc. Price and EPS Surprise
Inovalon Holdings, Inc. Price and EPS Surprise | Inovalon Holdings, Inc. Quote
Zacks Rank & Stocks to Consider
Currently, Inovalon carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader medical sector include Glaukos Corporation (GKOS - Free Report) , Avinger, Inc. (AVGR - Free Report) and Fluidigm Corporation . Notably, Glaukos and Fluidigm sport a Zacks Rank #1 (Strong Buy) while Avinger carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Glaukos Corporation has a long-term expected earnings growth rate of approximately 25%. Notably, the stock represents an impressive one-year return of 176.2%.
Avinger projects sales growth of 30.7% for the current year. Additionally, the company posted a positive earnings surprise of 27% in the last quarter.
Fluidigm Corporation has a long-term expected earnings growth rate of 25%. The stock has added 8.4% over the last one year.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>