athenahealth Inc

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ATHN : NASDAQ : Technology
$140.06 -1.4 | -1.0%
Today's Range: 140.04 - 141.45
Avg. Daily Volume: 568200.0
08/23/17 - 10:14 AM ET

Financial Analysis


ATHENAHEALTH INC's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. ATHENAHEALTH INC has average liquidity. Currently, the Quick Ratio is 1.36 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 26.77% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)301.1261.9
EBITDA ($mil)50.333.2
EBIT ($mil)15.0-0.3
Net Income ($mil)9.9-1.9


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)71.2134.3
Total Assets ($mil)1244.11119.77
Total Debt ($mil)280.0294.61
Equity ($mil)717.0565.57


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin62.960.94
EBITDA Margin16.712.67
Operating Margin4.98-0.11
Sales Turnover0.930.9
Return on Assets2.590.96
Return on Equity4.491.91
Debt Q2 FY17 Q2 FY16
Current Ratio1.621.68
Debt/Capital0.280.34
Interest Expense0.00.0
Interest Coverage0.00.0


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)39.939.31
Div / share0.00.0
EPS0.24-0.05
Book value / share17.9714.39
Institutional Own % n/a n/a
Avg Daily Volume591106.0627949.0

Valuation


BUY. ATHENAHEALTH INC's P/E ratio indicates a significant premium compared to an average of 73.59 for the Health Care Technology industry and a significant premium compared to the S&P 500 average of 24.23. For additional comparison, its price-to-book ratio of 7.84 indicates a significant premium versus the S&P 500 average of 3.02 and a significant premium versus the industry average of 6.07. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. After reviewing these and other key valuation criteria, ATHENAHEALTH INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ATHN 176.15 Peers 73.59   ATHN 33.23 Peers 25.86

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

ATHN is trading at a significant premium to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ATHN is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ATHN 58.59 Peers 44.19   ATHN 0.65 Peers 0.89

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

ATHN is trading at a significant premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ATHN trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ATHN 7.84 Peers 6.07   ATHN 196.29 Peers -143.12

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ATHN is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

ATHN is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ATHN 4.88 Peers 5.85   ATHN 13.81 Peers 35.48

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ATHN is trading at a discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ATHN significantly trails its peers on the basis of sales growth

 

 

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