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Allscripts (MDRX) Q1 Earnings and Revenues Miss Estimates

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Allscripts Healthcare Solutions (MDRX - Free Report) reported first-quarter 2020 adjusted earnings per share (EPS) of 9 cents, which missed the Zacks Consensus Estimate of 14 cents by 35.7%. The bottom line also declined 43.8% on a year-over-year basis.

Revenue Details

Revenues totaled $416.7 million, which lagged the Zacks Consensus Estimate by 1.2%. Also, the top line fell 3.5% year over year.

For first-quarter 2020, bookings came in at $205 million, down 28.3% from the prior-year quarter.

Segment Details

The Provider segment consists of the core integrated clinical software applications, financial management and patient engagement solutions targeted at clients across the entire continuum of care. Meanwhile, the new Veradigm segment primarily focuses on the payer and life sciences market.

Software delivery, Support and Maintenance

In the quarter under review, revenues at the segment amounted to $263.6 million on a reported basis, down 4.3% from the year-ago quarter's tally.

Client Services

At this segment, revenues totaled $153.1 million, down 2.2% from the year-ago quarter's figure.

Allscripts Healthcare Solutions Inc Price, Consensus and EPS Surprise

 

Allscripts Healthcare Solutions Inc Price, Consensus and EPS Surprise

Allscripts Healthcare Solutions Inc price-consensus-eps-surprise-chart | Allscripts Healthcare Solutions Inc Quote

Margins

Gross profit in the first quarter was $157 million, down 9.8% from the year-ago quarter. As a percentage of revenues, gross margin was 37.7%, down 262 basis points (bps) from the year-ago figure.

Adjusted operating loss in the reported quarter was $3 million against a profit of $9.6 million in the year-ago quarter.

Financial Update

The company exited the first quarter of 2020 with cash and cash equivalents totaled $204.3 million, up from $129.6 million at the end of 2019.

At the end of the first quarter, net cash used in operating activities totaled $3.7 million against net cash provided of $5.8 million at the end of 2019.

2020 Guidance

Due to the current uncertainty owing to the COVID-19 pandemic, Allscripts is withdrawing its financial outlook for 2020.

Summing Up

Allscripts ended the first quarter on a weak note. The company maintains momentum in its Provider business on the back of key client wins . The company is confident about its near and long-term outlook as it expects to benefit from a number of differentiated opportunities in its Provider and Veradigm businesses.

Meanwhile, the company witnessed a decline in its core Client Services and Software delivery unit revenues. Also, the company’s bookings declined year over year in the quarter. Allscripts is exposed to integration risks. Intense competition in the niche space is also a concern.

Zacks Rank and Key Picks

Allscripts currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the broader medical space are Aphria Inc. , Biogen Inc. (BIIB - Free Report) and Eli Lilly and Company (LLY - Free Report) .

Aphria reported third-quarter fiscal 2020 adjusted EPS of 2 cents against the Zacks Consensus Estimate of a loss of 4 cents. Net revenues of $64.4 million outpaced the consensus estimate by 14.6%. The company carries a Zacks Rank #2 (Buy) at present.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Biogen currently carries a Zacks Rank #2. It reported first-quarter 2020 adjusted EPS of $9.14, surpassing the Zacks Consensus Estimate by 18.1%. Revenues of $3.53 billion outpaced the consensus mark by 3.2%.

Eli Lilly delivered first-quarter 2020 EPS of $1.75, outpacing the Zacks Consensus Estimate by 12.9%. Revenues of $145.3 million surpassed the consensus estimate by 6.3%. The company currently sports a Zacks Rank #1.

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