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Here's Why You Should Add Cerner (CERN) to Your Portfolio
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Cerner Corporation is likely to gain from a series of recent developments and a strong view for the fourth quarter of 2019.
Shares of this company have rallied 37.9% compared with the industry’s 18% rise in a year’s time. The current level also compares favorably with the S&P 500 index’s 27.6% rise over the same time frame.
This $23.07-billion healthcare IT company currently has a Zacks Rank #2 (Buy). Cerner’s earnings are expected to grow 10.7% over the next five years. Also, the company has a trailing four-quarter positive earnings surprise of 1.2%, on average.
The stock also has a Growth Score of B. Our research shows that stocks with a Growth Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, are better picks than most.
Let’s take a closer look at the factors that are working in favor of the company right now.
Slew of Developments & Guidance
In recent times, Cerner has seen some positive developments.
Last month, the company announced plans to assist clients to further lower re-admission rates for patients, thereby reducing healthcare costs. This will help cut the amount of time physicians spend documenting patient visits. Additionally, the company announced an investment and partnership with i2i Systems in recent times.
Moreover, Vively Health, a risk-based provider delivering home-based primary care to the ost ulnerable atients in the United States, announced a five-year collaboration with Cerner. Per management, the goal is to improve care delivery and health outcomes for patients with multiple chronic conditions.
In recent times, Cerner also collaborated with Uber (UBER - Free Report) to reduce transportation barriers that can lead to delayed care, poor management of chronic conditions and declining health outcomes for patients.
Reflective of these, Cerner issued a strong outlook for the fourth quarter.
The company expects revenues between $1.41 billion and $1.46 billion. The mid-point of this range indicates growth of 5% from the prior-year quarter.
Adjusted earnings per share (EPS) are anticipated to range between 73 cents and 75 cents. The mid-point of this range is 17% higher than that reported in third-quarter 2018. This will bring full-year 2019 adjusted EPS to $2.67, indicating growth of 9% over 2018 levels.
Bookings revenues for fourth-quarter 2019 are estimated between $1.45 billion and $1.65 billion. The mid-point of this range indicates a decline of 21% from the prior-year quarter.
Which Way Are Estimates Headed?
For 2019, the Zacks Consensus Estimate for revenues is pegged at $5.69 billion. For adjusted EPS, the same stands at $2.67 per share, suggesting an upside of 9% from the year-ago reported figure.
DexCom’s fourth-quarter earnings growth rate is projected at 31.5%.
HealthEquity’s long-term earnings growth rate is 25%.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Here's Why You Should Add Cerner (CERN) to Your Portfolio
Cerner Corporation is likely to gain from a series of recent developments and a strong view for the fourth quarter of 2019.
Shares of this company have rallied 37.9% compared with the industry’s 18% rise in a year’s time. The current level also compares favorably with the S&P 500 index’s 27.6% rise over the same time frame.
This $23.07-billion healthcare IT company currently has a Zacks Rank #2 (Buy). Cerner’s earnings are expected to grow 10.7% over the next five years. Also, the company has a trailing four-quarter positive earnings surprise of 1.2%, on average.
The stock also has a Growth Score of B. Our research shows that stocks with a Growth Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, are better picks than most.
Let’s take a closer look at the factors that are working in favor of the company right now.
Slew of Developments & Guidance
In recent times, Cerner has seen some positive developments.
Last month, the company announced plans to assist clients to further lower re-admission rates for patients, thereby reducing healthcare costs. This will help cut the amount of time physicians spend documenting patient visits. Additionally, the company announced an investment and partnership with i2i Systems in recent times.
Moreover, Vively Health, a risk-based provider delivering home-based primary care to the ost ulnerable atients in the United States, announced a five-year collaboration with Cerner. Per management, the goal is to improve care delivery and health outcomes for patients with multiple chronic conditions.
In recent times, Cerner also collaborated with Uber (UBER - Free Report) to reduce transportation barriers that can lead to delayed care, poor management of chronic conditions and declining health outcomes for patients.
Reflective of these, Cerner issued a strong outlook for the fourth quarter.
The company expects revenues between $1.41 billion and $1.46 billion. The mid-point of this range indicates growth of 5% from the prior-year quarter.
Cerner Corporation Price and Consensus
Cerner Corporation price-consensus-chart | Cerner Corporation Quote
Adjusted earnings per share (EPS) are anticipated to range between 73 cents and 75 cents. The mid-point of this range is 17% higher than that reported in third-quarter 2018. This will bring full-year 2019 adjusted EPS to $2.67, indicating growth of 9% over 2018 levels.
Bookings revenues for fourth-quarter 2019 are estimated between $1.45 billion and $1.65 billion. The mid-point of this range indicates a decline of 21% from the prior-year quarter.
Which Way Are Estimates Headed?
For 2019, the Zacks Consensus Estimate for revenues is pegged at $5.69 billion. For adjusted EPS, the same stands at $2.67 per share, suggesting an upside of 9% from the year-ago reported figure.
Other Stocks to Consider
Other top-ranked stocks from the broader medical space are DexCom (DXCM - Free Report) and HealthEquity (HQY - Free Report) . While HealthEquity sports a Zacks Rank #1, DexCom carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
DexCom’s fourth-quarter earnings growth rate is projected at 31.5%.
HealthEquity’s long-term earnings growth rate is 25%.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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