TSC Ratings' Updates: Cerner

Note: Our quantitative model makes stock recommendations based on GAAP figures that may differ materially from data as reported by the companies themselves. As a result, rating changes are occasionally driven by so-called nonrecurring items. As always, we urge readers to use TSC Ratings' reports in conjunction with additional information to construct their opinions on the value that should be placed on any given stock.

The following ratings changes were generated on Tuesday, March 31.

We've upgraded Cerner(CERN Quote), which provides healthcare information technology solutions, health care devices and related services, from hold to buy. This rating is driven by the company's revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Revenue rose by 18.1% since the year-ago quarter. The company has a debt-to-equity ratio of 0.1, though it is still higher than the industry average. Its quick ratio is 2.3. EPS rose in the most recent quarter compared with the same quarter a year ago, and we anticipate the company's two-year trend of EPS growth to continue. Net income increased 73.1% compared with the year-ago quarter, from $41.3 million to $71.5 million. ...