Tuesday, June 14, 2016

Cerner May Monthly 2016 Report

Cerner May Monthly Report

During the month of April we purchased 60 shares of Cerner (representing a half position) at $56.60. Cerner opened the month on May 2nd at $56.96. Cerner closed on May 31st at a price of $55.61. This represents a 2.37% loss over the course of the month as well as a -1.75% loss since purchased at 56.60.   

On Friday May 19th, we completed a full position in Cerner by purchasing 60 additional shares at $54.40. This represents a 2.03% gain, nearly offsetting our loss from the other half position.

With a price target of $72.17, $29.77 upside remains. The main reason Cerner’s did not gain upside during the month of May was because its first quarter financial results did not exceed expectations. Cerner’s clinical information and services struggled to meet revenue expectations. In the quarter one earnings call, management lowered guidance for their clinical information and services resulting in their expectations being set very low. This leaves plenty of room for organic growth to materialize as well as prevent another miss on expectations. Earnings have a huge influence on the price of a companies stock and can be a catalyst for momentum. I believe Cerner will exceed their outlook with expectations being set low. This will result in Cerner’s stock price appreciating at a constant rate over the next quarter.

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