Aggressive · Stocks to Consider and Updates

Cerner Misses Earnings and Sales Estimates

Healthcare information services provider Cerner Corp. (NASDAQ: CERN – $62.95) reported bookings in the fourth quarter of 2017 were $2.329 billion, which is an all-time high and an increase of 62% compared to $1.437 billion in the fourth quarter of 2016.  Full-year 2017 bookings were also a record at $6.325 billion, up 16% compared to 2016 bookings. Revenue for the fourth period was $1.314 billion, an increase of 4% compared to $1.258 billion a year ago, but a bit shy of estimates. For all of 2017, revenue was $5.142 billion, up 7% percent compared to 2016. Earnings per share settled at $0.58, three cents short of Street views. Full year, free cash flow was $671.4 million and the company’s total backlog of $17.55 billion, is up 10% over the year-ago quarter.

Looking ahead, Kansas City-based Cerner expects:

  • First quarter 2018 revenue between $1.315 billion and $1.365 billion.
  • Full year 2018 revenue between $5.450 and $5.650 billion, compared to $5.142 billion for 2017.
  • First quarter 2018 adjusted earnings per share between $0.57 and $0.59. Full year 2018 adjusted earnings per share between $2.57 and $2.73.
  • First quarter 2018 new business bookings between $1.25 billion and $1.45 billion.

       That said, my sense is Cerner’s prospects remain intact, given its favorable position in the healthcare IT arena and shares can be maintained in a well-diversified aggressive account.

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