Allscripts-Misys Rises On Stimulus-linked Upgrade

NEW YORK (AP) — Shares of Allscripts-Misys Healthcare Solutions Inc. rose Thursday after a JPMorgan analyst upgraded the stock to "Overweight," as federal stimulus programs are seen spurring investments in information technology.

Atif Rahim said medical software makers Allscripts-Misys and Quality Systems Inc. are "the best stocks in the (health care IT) group to own at this time," ahead of both Cerner Corp. and Eclipsys Corp. In a note to clients, Rahim said the federal economic stimulus package includes $36.5 billion in incentives for doctors and hospitals who use electronic health records, and estimated that those funds will lead to $20.1 billion in new contracts for vendors between 2011 and 2019.

He said Allscripts has a large base of clients that doesn't have electronic health record systems at all, and it should be easy for the Chicago company to start converting those clients late this year and early next year.

Rahim downgraded Eclipsys stock to "Underweight" from "Neutral." The Atlanta-based company replaced its chief executive on May 14 and is also searching for a new chief financial officer, and the analyst said that creates a risk the company will fall behind its peers during the transition period.

In afternoon trading, Allscripts-Misys shares rose 90 cents, or 7.3 percent, to $13.30, and Eclipsys shares dipped 8 cents to $14.23.

Rahim maintained an "Overweight" or "Buy" rating on shares of Quality Systems, which slid 89 cents to $51.87, and kept a "Neutral" rating on Cerner stock, which lost 12 cents to $58.48.