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Why Computer Programs & Systems Is Ready to Rebound

By Brian D. Pacampara, CFA - Apr 8, 2013 at 10:37AM

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Market-trouncing returns could be written in this 5-Star.

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, health care IT solutions specialist Computer Programs & Systems (CPSI 2.54%) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Computer Programs and see what CAPS investors are saying about the stock right now.

Computer Programs facts

Headquarters (founded)

Mobile, Ala. (1979)

Market Cap

$586.0 million

Industry

Health care technology

Trailing-12-Month Revenue

$183.3 million

Management

Chairman/CFO David Dye

CEO J. Boyd Douglas

Return on Equity (average, past 3 years)

48%

Cash/Debt

$19.6 million / $0

Dividend Yield

3.8%

Competitors

Healthcare Management Systems

Healthland

Medical Information Technology

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 93% of the 137 members who have rated Computer Programs believe the stock will outperform the S&P 500 going forward.

Just last week, one of those bulls, Motley Fool Co-Founder David Gardner (TMFSpiffyPop), succinctly summed up the outperform case for our community:

Niche player serving rural hospitals and hard to compete with on that terrain. Decent dividend. Long operating history. Electronic health records are a good space. That said, as the company further grows into its niche, it's not clear to me a couple years out that there is meaningful growth past that. Could be a buyout candidate at some point. Anyway, for the next couple of years: Outperform.

 Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

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Stocks Mentioned

Computer Programs and Systems, Inc. Stock Quote
Computer Programs and Systems, Inc.
CPSI
$32.31 (2.54%) $0.80

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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