Quality Systems (Nasdaq: QSII) hasn't been able to establish an earnings trend, bouncing between beating and falling short of estimates during the past fiscal year. The company will unveil its latest earnings on Monday, July 25. Quality Systems develops and markets healthcare information systems that automate certain aspects of medical and dental practices, networks of practices, ambulatory care centers, community health centers, and medical and dental schools.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Quality Systems with 16 of 23 analysts rating it hold. Analysts don't like Quality Systems as much as competitor Allscripts overall. Sixteen out of 24 analysts rate Allscripts a buy compared to six of 23 for Quality Systems. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.
  • Revenue Forecasts: On average, analysts predict $99 million in revenue this quarter. That would represent a rise of 19.4% from the year-ago quarter.
  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.62 per share. Estimates range from $0.55 to $0.73.

What our community says:
CAPS All Stars are solidly behind the stock, with 98.7% awarding it an "outperform" rating. The community at large backs the All Stars, with 97% granting it a rating of "outperform." Fools are bullish on Quality Systems and haven't been shy with their opinions lately, logging 619 posts in the past 30 days. Even with a robust four out of five stars, Quality Systems' CAPS rating falls a little short of the community's upbeat outlook.

Management:
Quality Systems' profit has risen year over year by an average of 26.5%.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters:

Quarter

Q4

Q3

Q2

Q1

Gross Margin

65.8%

64.8%

63.0%

61.6%

Operating Margin

29.3%

28.1%

25.6%

22.9%

Net Margin

19.1%

19.1%

16.5%

14.6%

One final thing: If you want to keep tabs on Quality Systems movements, and for more analysis on the company, make sure you add it to your Watchlist.

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