Allscripts Dips; Final Buying Opportunity?

Does that mean it is time to give these health care IT stocks another look as a potential buy? Caris has a $22 price target on Allscripts, while Maxim Group has a $23 price target. Allscripts was at $18.75 after its 5% decline on Monday morning.

Maxim Group analyst Anthony Vendetti said the pullback in the Allscripts stock price is a buying opportunity. "Allscripts will win their fair share of business, and there is still plenty of opportunity for them to capitalize on, which supports a buy and a $23 price target," Vendetti said. Vendetti said that while the bookings number was lighter than expected, market expectations have probably been too high for some of these health care IT players.

"The expectations are that numbers will come in strong all the time, and that's not realistic," Vendetti said. While he conceded that the bookings number is a concern and does indicate that sales may get pushed out a little bit, he is not adjusting his earnings models.

"Even with the lower hurdle of 90 days of consecutive use, it's not like doctors can push this out to the last three months of the year," Vendetti said. He also noted that Allscripts had one large hospital client in the past quarter, North Shore Long Island Jewish, which could have helped to make previous bookings look larger than the current quarter, which featured more small deals.

Caris's Carpio said during the earnings conference call that Allscripts' management conceded that adoption had been slower than expected among small groups and individual physicians, and that did not help instill confidence.

However, Maxim's Vendetti said his talk with Allscripts management today was positive. "We spoke with the company, and we're confident that the new deals will set the stage for strong bookings and revenue growth," Vendetti said.

-- Reported by Eric Rosenbaum in New York.

RELATED STORIES:

>>Health care Dogs are Best Bet in 2010

>>Health Care Stocks to Watch in 2010

>>Express Scripts Hits 52-Week High

>>See our new stock quote page.

Follow TheStreet.com on Twitter and become a fan on Facebook.

>To order reprints of this article, click here: Reprints