Cerner Corporation released earnings Thursday with their
fifth consecutive quarter of double-digit growth. Their revenue was $676.5
million which was an 18.5% increase from Q3 2011, and beat analyst estimates of
$638.1 million. Cerner reported adjusted net income of 60 cents per share which
beat analyst estimates of 55 cents per share. Cerner also was able to add
several new clients, both in the United States and Globally. One of Cerner’s
new initiatives that our thesis was based on was their cloud-based solutions,
and they made great progress rolling them out. Cerner has not changed their
outlook for the fourth quarter and remains at 61 cents per share, which leaves
full year EPS estimates at $2.22 per share. Cerner released after the bell and
the stock rallied 10% following the announcement. At the bell the next morning
Cerner opened up as high as 15% before retracting to gains of about 11%. This
earnings release confirms our thesis and we will continue to hold Cerner
Corporation with a price target of $95.
Ryan Ranado, Technology Sector Head
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