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Cerner's Second Quarter Earnings Report
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CERN
Cerner (Nasdaq:CERN) announced its results for the most recent quarter on July 26, 2012. Cerner Corporation designs and supports healthcare devices, healthcare information technology, and content solutions for organizations and consumers.
Investors care about earnings because they drive stock prices. Strong earnings generally result in the stock price moving up and vice versa. SEE: 5 Tricks Companies Use During Earnings Season
The Numbers: Cerner's EPS beat estimates and the company's revenues fell in line with predictions. The company reported 56 cents per share versus the 51 cents per share estimate and revenues of $637.4 million versus the $638.1 million estimate. EPS rose 33.3% while revenue climbed 21.6% from the same period last year. Cerner has averaged revenue growth of 22.7% over the past five quarters. For the second quarter, the company reported net income of $97.8 million. According to the reported number, this is up 35.8% from last year's figures. Last quarter marked the third in a row of rising net income.
Management Quote: "I am pleased with our results in the second quarter, which again included strong revenue and earnings growth and very strong cash flow," Neal Patterson, Cerner chairman, CEO, president and co-founder said. "Our client base continues to make great progress at qualifying for stimulus payments related to the HITECH Act and our strong competitiveness is leading to new clients choosing Cerner. We believe the digitization being driven by the HITECH Act creates a foundation for significant ongoing investments in information technology and services, such as data analytics and population health management, that will be critical as health care providers become accountable for the health of populations under future reimbursement models."
A Look Back: Net income has increased 32.3% year-over-year on average across the last five quarters. The biggest gain came in the first, when income climbed 37.4% from the year-earlier quarter.
Looking Ahead: When earnings estimates stay consistent leading up to earnings season, this usually shows analysts accurately predicted earnings estimates and business is stable. Be cautious though as this may also be a warnings sign that earnings could come at a huge surprise to the upside or downside as analyst did not correctly predict earnings. Steady earnings estimates mean there is not enough change going on with the company to make analysts change their opinions. When earning estimates are steady, investors can look at the revenue trend for a more fundamental indicator. For the fiscal year, the average estimate has moved up from $2.16 a share to $2.18 over the last ninety days.
Investors care about earnings because they drive stock prices. Strong earnings generally result in the stock price moving up and vice versa. SEE: 5 Tricks Companies Use During Earnings Season
The Numbers: Cerner's EPS beat estimates and the company's revenues fell in line with predictions. The company reported 56 cents per share versus the 51 cents per share estimate and revenues of $637.4 million versus the $638.1 million estimate. EPS rose 33.3% while revenue climbed 21.6% from the same period last year. Cerner has averaged revenue growth of 22.7% over the past five quarters. For the second quarter, the company reported net income of $97.8 million. According to the reported number, this is up 35.8% from last year's figures. Last quarter marked the third in a row of rising net income.
Management Quote: "I am pleased with our results in the second quarter, which again included strong revenue and earnings growth and very strong cash flow," Neal Patterson, Cerner chairman, CEO, president and co-founder said. "Our client base continues to make great progress at qualifying for stimulus payments related to the HITECH Act and our strong competitiveness is leading to new clients choosing Cerner. We believe the digitization being driven by the HITECH Act creates a foundation for significant ongoing investments in information technology and services, such as data analytics and population health management, that will be critical as health care providers become accountable for the health of populations under future reimbursement models."
A Look Back: Net income has increased 32.3% year-over-year on average across the last five quarters. The biggest gain came in the first, when income climbed 37.4% from the year-earlier quarter.
Looking Ahead: When earnings estimates stay consistent leading up to earnings season, this usually shows analysts accurately predicted earnings estimates and business is stable. Be cautious though as this may also be a warnings sign that earnings could come at a huge surprise to the upside or downside as analyst did not correctly predict earnings. Steady earnings estimates mean there is not enough change going on with the company to make analysts change their opinions. When earning estimates are steady, investors can look at the revenue trend for a more fundamental indicator. For the fiscal year, the average estimate has moved up from $2.16 a share to $2.18 over the last ninety days.
by
Investopedia Staff
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