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Athenahealth, Inc. (ATHN) Message Board

  • tradingmatrixtfg tradingmatrixtfg Aug 25, 2010 11:51 AM Flag

    The ATHN bear case

    Thesis
    Athenahealth (ticker: ATHN), ever since its 2007 IPO, has been hyped as a SaaS company with a federal stimulus story on top. The company earns substantially all of its revenue from its revenue cycle management (RCM) software, yet the street values them as if they will garner significant market share in the electronic health records (EHR) space as the government begins to pay out “meaningful use” bonuses. We think the street is egregiously overestimating the part that ATHN will play in the EHR narrative. ATHN has managed to grow their physician client base nicely over the past 3 years (although that growth has slowed), nonetheless, we believe they are targeting the wrong market as it will be hospitals that drive the adoption of EHR going forward. Once investors realize that, as far as athenahealth is concerned, the EHR story is just a bunch of hot air, its earnings multiple will be cut in half and consensus estimates will come down, resulting in a per share price in the $15-$20 range...

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