Baird Equity Research maintains an Outperform rating for athenahealth, Inc (NASDAQ: ATHN) after the company reported earnings Thursday after the market close. Analyst
Michael Gillmor thinks the third-quarter report was just slightly
worse than feared, but the risk-reward is still favorable.
The company reported lower than expected revenue due to low utilization and hurricanes. Bookings were soft on weak buying
activity, and athenahealth decided to lower its revenue guidance.
There were also some positives: The company is implementing cost reductions faster than expected. The company expects to
generate $100 to $115 million of cost savings in 2018. Its cost savings include rationalizing marketing spend, office closures, and
a new organizational structure.
Gillmor explained that the stock has some technical support around current price level (see Gillmor's track record here). Even with the assumption of slower growth in 2018, the analyst
believes the risk-reward is attractive around 11 to 14 times implied EBITDA potential. Athenahealth reduced revenue guidance to
$1.2 to $1.22 billion from a range of $1.21 million to $1.25. Gilmore thinks the revenue growth in 2018 should be at least 10
percent higher.
See also: 32 Stocks
Moving In Friday's Mid-Day Session
Latest Ratings for ATHN
Date |
Firm |
Action |
From |
To |
Oct 2017 |
KeyBanc |
Maintains |
|
Overweight |
Oct 2017 |
Jefferies |
Maintains |
|
Hold |
Sep 2017 |
RBC Capital |
Initiates Coverage On |
|
Sector Perform |
View More Analyst Ratings for
ATHN
View the Latest Analyst Ratings
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