Cerner Corp. (CERN) expanded its health information technology (HTHIY) solution client base to 24 countries by offering Cerner Millennium to a privately-owned 674-bed Hospital Israelita Albert Einstein in Brazil. The HIT solution will help improve the quality of patient care and streamline operations in the hospital.
The first phase of the project involves translation of Cerner Millennium into Portuguese, Orders, Documentation, electronic medical record (EMR), Pharmacy, Patient Management, Billing, ER, ICU, Oncology, Cardiology, Laboratory, Surgery, Ambulatory practice, Medication Administration, Women's Health and various Performance Improvement and Quality Outcomes solutions across the acute care facility and clinics in the hospital. Currently, the hospital has eight ambulatory clinics in Sao Paulo.
CERN started rising and has been hovering around its 52-week high recently following the announcement of a multiyear partnership with Utah-based non-profit health care provider Intermountain Healthcare, which has 22 hospitals, 185 clinics, a medical group comprising 1,000 physicians and a health plans division.
The partnership agreement will implement Cerner’s electronic medical record and revenue cycle solutions across all of Intermountain's hospitals and clinics. It will also develop a new set of tools for a post-fee-for-service world in areas such as activity-based costing. It is expected to generate more than $50 million in annual revenue for CERN.
Cerner reported a 14.3% rise in second-quarter 2013 earnings per share to 32 cents, meeting the Zacks Consensus Estimate. Net income rose 15.4% year over year to $112.9 million.
Revenues in the quarter rose 11.0% year over year to $707.6 million. However, it missed the Zacks Consensus Estimate of $724 million. The revenues growth was at the lower end of Cerner’s earlier assumptions due to reduced volume of tech resale, which carries a lower margin.
For the third quarter of 2013, CERN forecasts revenues in a band of $740 million–$770 million. Earnings per share, before share based compensation expense, are expected in the range of 35 cents to 36 cents. Cerner projects stock-based compensation costs to dilute second quarter earnings by about 2 cents to 3 cents.
For 2013, the company continues to forecast revenues in the region of $2,950 million to $3,050 million. Earnings per share, before share based compensation expense, are forecasted in the range of $1.40 and $1.42 (earlier $1.39 and $1.42). Cerner projects stock-based compensation costs to dilute earnings by about 8 cents to 9 cents.
Cerner carries a Zacks Rank #3 (Hold). While there are no other medical information systems stocks that are currently worth a look, we consider medical product stocks such as Bio-Rad Laboratories, Inc. (BIO) with a Zacks Rank #1 (Strong Buy), and Boston Scientific Corp. (BSX) and Hospira Inc. (HSP), both with a Zacks Rank #2 (Buy).