Quality Systems Slides After 4Q Results Disappoint

NEW YORK (AP) — Shares of Quality Systems Inc. fell Friday after the health care information technology company posted disappointing fiscal fourth-quarter results.

While the Irvine, Calif., company's sales grew 29 percent in the March quarter, analysts expected stronger growth. Profit was nearly unchanged because the company's expenses increased.

In afternoon trading, Quality Systems stock lost $4.82, or 9.2 percent, to $47.85 in afternoon trading. It has ranged from $25.70 to $62 over the past year.

Raymond James analyst Alexander Draper said the company reported a weaker profit margin, and sales of software, hardware and supplies were more than $2 million below his expectations.

"We are disappointed with the company's quarterly results, which we believed would show some early signs of stimulus-related selling success with Indian Health Service and Federally Qualified Health Clinics," he said.

Deutsche Bank analyst Ross Muken said spending delays will continue to affect health care information technology companies like Quality Systems despite the benefits of the stimulus package.

The stimulus, which was signed into law in February, allocates billions in funding over the next decade to hospitals and physician practices who adopt electronic medical records like those provided by Quality Systems. The company said uncertainty about the details of the stimulus caused some of its customers to hold off on making purchases.