Cerner Corporation (CERN - Free Report) was recently selected by the Indiana Family and Social Services Administration (FSSA) for the implementation of the company’s electronic health record (EHR) and revenue cycle management solutions in six state-run psychiatric facilities.
Shares of Cerner rallied 1.6% the day following the announcement.
FSSA is an organization that aims to provide healthcare and other social services to the inhabitants of Indiana. The organization’s doctors and nurses will be now assisted by Cerner’s advanced health care IT platform, improving patient care across Indiana.
FSSA will use Cerner Millennium, Cerner’s coveted healthcare IT platform designed for hospitals delivering behavioral health sciences and supporting an individual’s health care journey. This will resultantly unify FSSA’s facilities under one integrated system, facilitating the sharing of patient health data between facilities.
Additionally, FSSA’s imminent NeuroDiagnostic Institute will be supported by Cerner Millennium.
Furthermore, the use of Cerner’s Clinically Driven Revenue Cycle solutions will enable clinicians to view medical and financial data of a patient in a single platform.
Evidently, such developments will fortify Cerner’s position in the Healthcare IT (HCIT) space.
Cerner Millennium in Focus
In the last reported quarter, Cerner’s existing clients continued to migrate from legacy systems to Cerner Millennium. Per management, Cerner has brought over 300 hospitals and more than 1200 ambulatory facilities under its revenue cycle solutions since 2017.
Moreover, the company foresees significant growth opportunities in the EHR market. Per management, there are more than 2000 hospitals on the EHR platform, all of which need to be updated in the near future.
Cerner Millennium platform has also seen a slew of developments lately. Recently, The Menninger Clinic chose to implement Cerner Millennium EHR through the new Cerner Integrated Behavioral Health deployment model.
Additionally, Texas-based Rankin County Hospital District recently selected the Cerner Millennium EHR with a view to aid doctors, nurses and staff work more efficiently.
Per a study by Markets and Markets, the healthcare IT market is expected to reach $280.25 billion by 2021 at a CAGR of 15.9%. Primary growth drivers of the market are high return on investment in HCIT solutions, government directives and the need to curtail escalating healthcare costs.
We believe that the latest developments will provide cushion to Cerner’s shares that have lost 8% against the industry’s return of 4.6% in the past six months.
Zacks Rank & Key Picks
Cerner currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the broader medical space are ABIOMED, Inc. (ABMD - Free Report) , Genomic Health, Inc. (GHDX - Free Report) and Exelixis, Inc. (EXEL - Free Report) .
ABIOMED has a long-term growth rate of 27%. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Genomic Health has an expected growth rate of 187.5% for the current quarter. The stock has a Zacks Rank #1.
Exelixis has a projected growth rate of 75% for the current quarter. The stock sports a Zacks Rank #1.
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