) reported net earnings of $115.3 million or 33 cents per share
for the third quarter of the year, meeting the Zacks Consensus
Estimate. This reflected a 16.6% rise from $98.9 million and
17.9% from 28 cents in the comparable quarter a year ago.
Revenues in the quarter grew 8% to $727.8 million, but it was
below the Zacks Consensus Estimate of $756 million. In fact, the
revenue growth was below CERN's own expectations due to decreased
levels of low-margin technology resale.
Segment wise, Support, maintenance and services revenues rose
17.6% to $508.5 million and Reimbursed Travel revenues went up
16.8% to $16.7 million. However, revenues from System sales
dipped nearly 12.0% to $202.6 million.
Bookings rose 21% to the all-time third quarter high of $928.0
million. Total backlog increased 24% to $8.4 billion, which
comprised of $7.63 billion of contract backlog and $769.8 million
of support and maintenance backlog.
Cerner had cash and cash equivalents of $287.5 million as of Sep
28, 2013, down from $317.1 million as of Dec 29, 2012. Total debt
rose to $182.9 million as of Sep 28, 2013 compared with $196.1
million as of Dec 29, 2012.
In the first nine months of 2013, cash flow from operating
activities rose 5.0% to $554.4 million from $527.8 million in the
same period of 2012. Capital expenditure nearly doubled to $218.4
million compared with $130.0 million a year ago.
For the fourth quarter of 2013, Cerner anticipates revenues
between $775 and $815 million while earnings are expected between
38 and 39 cents per share. The leading healthcare information
technology ("HCIT") solutions provider also expects new business
bookings between $1 and $1.1 billion for the quarter.
We believe long-term investors may consider Cerner, which serves
a sizeable installed hospital base that requires composite
clinically-oriented applications complying with "meaningful use"
needs, reimbursement difficulties and coding challenges. The
company has long-standing, integrated and seamless solutions for
both inpatient and ambulatory settings. CERN currently retains a
Zacks Rank #2 (Buy).
We are also optimistic about
Greenway Medical Technologies, Inc.
), which carries a Zacks Rank #1 (Strong Buy), in the medical
information systems industry. Other stocks from the medical
products industry that are worth a look include
Bio-Rad Laboratories, Inc.
INSYS Therapeutics, Inc.
), both with a Zacks Rank #1 (Strong Buy).
BIO-RAD LABS -A (BIO): Free Stock Analysis
CERNER CORP (CERN): Free Stock Analysis
GREENWAY MEDICL (GWAY): Free Stock Analysis
INSYS THERAP (INSY): Free Stock Analysis
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