Health Care Winners & Losers: Cerner

Updated from 3:43 p.m. ET Health care information technology stocks slid Tuesday after a Leerink Swann analyst said the electronic medical records portion of President-elect Barack Obama's economic stimulus package will not help the sector right away.

"Our best guess as to the time line for federal money to work through state grant and loan programs in any material way is at least 12-18 months," Bret Jones said in a client note. The climate for health care IT companies is still very difficult, Jones wrote, and investors may be disappointed as they wait for the stimulus package to take effect.

In his presidential campaign, Obama proposed greater funding for electronic medical records as part of a plan to save money for patients and reduce health care premiums. That funding is expected to be tied to an impending economic stimulus plan.

The analyst predicted health care IT stocks will be flat or lower until mid-2009 as hospital health care IT projects get phased in or delays occur. He said they will recover later in the year, when the funding is more certain and the details of the Obama plan are better understood.

Jones downgraded shares of Cerner (CERN Quote), AthenaHealth (ATHN Quote), Allscripts-Misys Healthcare Solutions (MDRX Quote) and Quality Systems (QSII Quote) to "Market Perform" from "Outperform." Each of those stocks has climbed at least 20% since Dec. 1, with shares of Allscripts and Quality Systems rising more than 50%.

In afternoon trading, AthenaHealth shares fell 85 cents, or 2.3%, to $35.00, while Cerner stock fell $1.77, or 4.5%, to $37.57 and Quality Systems shares gave up $2.85 or 6.8%, to $39.27. Shares of Allscripts-Misys lost 83 cents, or 8.3%, to $9.16.