NCR Divests Healthcare Solution

NCR Corporation (NCR - Analyst Report) recently entered into a definitive agreement with QuadraMed Corporation, a leading provider of healthcare technologies that improve the overall patient care services, to sell certain healthcare solutions. 

As per the agreement, NCR Corp will divest its diversified healthcare solutions, such as MediKiosk patient access software, NCR Payment Manager, Patient Portal, Patient Tracking, Physician Referral Portal and eForms software solutions. The financial terms of the agreement has not been disclosed.

This apart, the ATM major has entered into a reseller agreement with QuadraMed to provide hardware and self-service devices for its check-in and identification management solutions. QuadraMed will also obtain NCR’s healthcare employees responsible for selling, developing, and servicing these solutions, posting them in QuadraMed facilities in Florida and India.

We believe that NCR is in the process of streamlining its operations and wants to focus on its core competency. The company believes that the disposition of this business to QuadraMed will help customers receive better service, while NCR continues to focus on its core business and explore new opportunities to expand it.

Moreover, NCR is also seeking opportunities in the airline industry. The company recently secured new business from “nasair,” a low-cost airline in Saudi Arabia. As per the contract, NCR will design a mobile-optimized website for the company in order to simplify its travel plan management.

This would help the “nasair” passengers to reserve and purchase tickets, update reservation details and get information about flight schedules. NCR Corp further intends to include mobile check-in and the text delivery of mobile boarding passes through SMS, as well as web apps for iPhone, BlackBerry and Android mobile devices.

So, it is evident that NCR is making new moves to explore possibilities, and also streamlining its operations to focus on its core competencies. NCR also reported decent third quarter results, with revenues improving across all business segments. However, sales for the upcoming quarters may be affected by the recent European debt crisis coupled with the reduction in the IT spending forecast.

We are positive about the company’s market leadership, successful acquisitions, product introductions and continued customer wins. However, its restructuring initiatives have begun impacting results.

The company has a short term Zacks #3 Rank (implying a short-term Hold recommendation).

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