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MedTech Takes to Big Data Analytics: 3 Stocks Catch Eye

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After the phenomenal rise of Artificial Intelligence (AI), big data analytics is taking the world by storm.

Be it technology, auto, retail or the banking sector, big data has been the core of all industries. In fact, the global big data market is expected to see a CAGR of 10% to reach a value of $76 billion by 2020 (Research and Markets).

The MedTech sector under healthcare is no exception. A fresh report by Research and Markets shows that big data in healthcare raked in $11.45 billion in 2016 and is expected to grow double-digits in the 2017-2025 period.

Thus, focusing on MedTech stocks that are leveraging from the fast-growing big data trend seems prudent. Here, we should also know that MedTech bigwigs already have a strong footing in the U.S. market, courtesy of R&D innovation, increasing consolidation and tax abatement.

Now, let’s take a look at the major factors that are driving the importance of big data in the MedTech space.

Electronic Health Records

The latest trend of electronic health records (EHR), electronic medical records, predictive analytics, real-time alerting and revenue cycle management services in the U.S. MedTech space has been gaining prominence.

Of these, the cloud-based EHR model is the most common application of big data in healthcare. According to Transparency Market Research, the global EHR market is expected to see a CAGR of 5.7% from 2017 to 2025, to reach an estimated value of $38.29 billion.

Reports suggest that MedTech companies with strong exposure to big data automated EHRs will excel in terms of operations and margins.

Of the major companies in the space, athenahealth Inc has been hogging the limelight on its cloud-based big data network — athenaNet. The company also recently launched a machine-learning model to automate faxes.

Three other companies are also poised to gain from the rising influence of big data on MedTech. These stocks have a VGM Style Score of A or B and a Zacks Rank #3 (Hold).

Notably, the VGM Score is a comprehensive tool that helps investors screen winning stocks from the broader sectors. Further, the score highlights the determining elements in a stock that can drive it higher.

Allscripts Healthcare Solutions (MDRX - Free Report) has a VGM Score of A and a long-term expected earnings growth rate of 13.8%.

The company is known for its comprehensive suite of fully-integrated EHR platforms like Allscripts Sunrise and Paragon. While Sunrise connects all clinical and financial aspects of a hospital or health system for inpatient, emergency and outpatient care, Paragon is an EHR and administrative solution for smaller hospitals, serving a single community.

Last month, Allscripts had launched a new EHR solution — Avenel.

In a bid to revamp EHR, Allscripts has invested extensively in the Avenel user interface and created the app-like functionality, featuring tablet-friendly swipe-and-tap navigation with easy-to-configure dashboards.

Allscripts Healthcare Solutions, Inc. Price and Consensus

 

Quality Systems, Inc. (QSII) has a VGM Score of B and a long-term expected earnings growth rate of 7.9%.

The company, also known as NextGen Healthcare to clients, received the 2018 Best in KLAS Award as the best vendor for EHR in United States.

Per management, the company has more than 100 clients integrated into the national care quality framework for interoperability.

Interestingly, Quality Systems’ EHR solutions range from machine-learning algorithms for health care to large-scale genome and health record analysis for cancer research.

Quality Systems, Inc. Price and Consensus

 

Cerner Corporation (CERN) has been dominating the headlines of late, courtesy of its efforts to digitize EHR systems. The stock has a VGM Score of B and a projected long-term earnings growth rate of 14.2%.

Cerner's HealtheIntent is a big data platform, which provides the company with significant exposure to AI trends in the medical world.

HealthIntent can fetch data from any EHR system, pharmacy benefits managers and insurance claims.

At the end of the fourth quarter, management announced that developments like these are likely to drive the company's operating costs along with R&D investments.

Cerner Corporation Price and Consensus

 

 

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