The 10-second takeaway
For the quarter ended March 30 (Q1), Cerner missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share grew significantly. GAAP earnings per share grew significantly.
Margins grew across the board.
Cerner recorded revenue of $680.0 million. The 18 analysts polled by S&P Capital IQ expected to see sales of $708.4 million on the same basis. GAAP reported sales were 8.0% higher than the prior-year quarter's $629.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.66. The 19 earnings estimates compiled by S&P Capital IQ predicted $0.63 per share. Non-GAAP EPS of $0.66 for Q1 were 22% higher than the prior-year quarter's $0.54 per share. GAAP EPS of $0.62 for Q1 were 22% higher than the prior-year quarter's $0.51 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 81.3%, 460 basis points better than the prior-year quarter. Operating margin was 23.0%, 280 basis points better than the prior-year quarter. Net margin was 16.2%, 210 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $727.1 million. On the bottom line, the average EPS estimate is $0.68.
Next year's average estimate for revenue is $3.00 billion. The average EPS estimate is $2.81.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 406 members out of 453 rating the stock outperform, and 47 members rating it underperform. Among 133 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 127 give Cerner a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cerner is outperform, with an average price target of $92.97.
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