Tomorrow, Quality Systems (NASDAQ:QSII) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed kneejerk reaction to news that turns out to be exactly the wrong move.

Quality Systems is a small company, but it has made a big impression in the medical-records business with its specialized data management systems. By allowing doctors and other medical professionals to manage information more efficiently, Quality Systems has sought to make itself an indispensable part of successful health-care practices, and the networking effects that it could reap in the long run are substantial. Let's take an early look at what's been happening with Quality Systems over the past quarter and what we're likely to see in its quarterly report.

Stats on Quality Systems

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$117.31 million

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

Will Quality Systems finally impress analysts this quarter?
Analysts have mildly downgraded their earnings estimates for Quality Systems over the past several months, leaving their calls for the March quarter unchanged but cutting their fiscal 2014 projections by $0.02 per share. But the stock really hasn't gone anywhere lately, falling 1% since mid-February.

Quality Systems offers a comprehensive set of electronic offerings for health care, going beyond medical records to provide payment and collection recordkeeping as well as specialized software for dental practices and their own unique needs. As Obamacare and other health-care reform efforts take effect, the need for medical professionals to be as efficient as possible increases, and Quality Systems aims to make that job easier for them to tackle.

Quality Systems certainly has plenty of growth potential. Late last month, competitor Cerner (NASDAQ:CERN) announced record bookings for its first quarter, and with a strong backlog and favorable guidance for the full 2013 year, Cerner is finding promising ways forward to grow its business. Cerner's results point to strength not just within the company but for the broader industry as well, and Quality Systems is poised to tap into the generally positive environment.

One big opportunity that Quality Systems will try to cash in on this year is the trend toward medical professionals switching their electronic-health-records vendors. With one survey showing that as many as 1-in-6 of every users wanting to make a change, the industry could go through a big upheaval. Unfortunately for Quality Systems, its customer rankings are relatively low, and it appears that rival athenahealth (NASDAQ:ATHN) could end up drawing business away from Quality Systems and peer Allscripts (NASDAQ:MDRX) based on their respective perceptions by customers.

In Quality Systems' report, look for innovative ways in which the company expects to find new growth. The example of up-and-coming rival Medidata and its focus on managing the FDA approval process for drug companies illustrates how Quality Systems needs to keep thinking outside the box and look for further value-added offerings that fit with its overall mission of making it easier for medical professionals to do their jobs.

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Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Athenahealth and Quality Systems. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.