Allscripts Healthcare Solutions, Inc.
) is set to report its first-quarter 2014 financial results after
the market closes on May 8. In the last reported quarter, the
company's earnings were in line with the Zacks Consensus
Estimate. Allscripts delivered negative surprises in 3 of its
last 4 quarters, with an average miss of 68.72%. Let's see
how things are shaping up for this announcement.
Factors at Play
Allscripts's earnings slumped 55.6% year over year to 4 cents
per share in the fourth quarter of 2013. However, the bottom line
was on par with the Zacks Consensus Estimate.
Revenues were flat at $351.0 million in the quarter but
surpassed the Zacks Consensus Estimate of $343 million. However,
considering deferred revenues and other adjustments, Allscripts
experienced a 4% year-over-year drop in its adjusted total
revenues to $353.6 million.
Category wise, adjusted system sales revenues remained flat
compared to the prior year, due to significantly lower hardware
revenues in the fourth quarter. Adjusted revenues from
Allscripts' transaction processing and other category declined 2%
on a year-over-year basis, as a result of the company's loss of
an outsourcing client.
Allscripts' total bookings increased 51.6% year over year to
$274 million in the reported quarter, with population Health
Management solutions constituting 42% of total bookings compared
to 26% in the prior-year quarter.
Apart from strong sales of Population Health Management
solutions, wherein bookings increased almost 90% over last year,
new wins in the core acute electronic health record markets for
Sunrise and increasing wallet share within Allscripts' existing
Acute and Ambulatory base also contributed to the impressive
improvement in the quarter's bookings. Management believes that
the 87% growth in its subscription bookings has helped the
company build its backlog at present, and will definitely improve
its long-term revenue visibility.
Allscripts' management provided guidance for adjusted revenues
and adjusted EBITDA over the next 3 years. The company expects
adjusted revenues to grow in the range of 5-8% and adjusted
EBITDA to grow in the range of 18-22% over the next three
Our proven model does not conclusively show that Allscripts is
likely to beat earnings this quarter. That is because a stock
needs to have both a positive
and a Zacks Rank of #1, 2 or 3 for this to happen. That is not
the case here as you will see below.
: Expected Surprise Prediction or ESP represents the
difference between the Most Accurate estimate and the Zacks
Consensus Estimate. Allscripts has a Zacks ESP of 0.00%.
: Allscripts's Zacks Rank #4 (Sell) when combined with a 0.00%
ESP makes surprise prediction difficult. We caution against
stocks with Zacks Ranks #4 and 5 (Sell-rated stocks) going into
the earnings announcement, especially when the company is seeing
negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post
an earnings beat this quarter:
Myriad Genetics Inc
), earnings ESP of +10.87% and a Zacks Rank #1 (Strong Buy).
LDR Holding Corporation
), earnings ESP of +26.32% and a Zacks Rank #2 (Buy).
), earnings ESP of +0.89% and a Zacks Rank #2.
ALLERGAN INC (AGN): Free Stock Analysis
LDR HOLDING (LDRH): Free Stock Analysis
ALLSCRIPTS HLTH (MDRX): Free Stock Analysis
MYRIAD GENETICS (MYGN): Free Stock Analysis
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