The 10-second takeaway
For the quarter ended June 29 (Q2), 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. GAAP earnings per share grew.
Margins grew across the board.
Cerner booked revenue of $707.6 million. The 21 analysts polled by S&P Capital IQ expected to see a top line of $725.7 million on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $621.3 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 $0.34. The 21 earnings estimates compiled by S&P Capital IQ predicted $0.33 per share. Non-GAAP EPS of $0.34 for Q2 were 13% higher than the prior-year quarter's $0.30 per share. GAAP EPS of $0.32 for Q2 were 14% higher than the prior-year quarter's $0.28 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 82.2%, 340 basis points better than the prior-year quarter. Operating margin was 23.5%, 160 basis points better than the prior-year quarter. Net margin was 16.0%, 30 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $761.5 million. On the bottom line, the average EPS estimate is $0.36.
Next year's average estimate for revenue is $2.97 billion. The average EPS estimate is $1.41.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 417 members out of 463 rating the stock outperform, and 46 members rating it underperform. Among 140 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 130 give Cerner a green thumbs-up, and 10 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cerner is hold, with an average price target of $49.21.
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