Trade-Ideas: Cerner (CERN) Is Today's New Lifetime High Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Cerner ( CERN) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Cerner as such a stock due to the following factors:

  • CERN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $86.4 million.
  • CERN has traded 9,106 shares today.
  • CERN is trading at a new lifetime high.

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More details on CERN:

Cerner Corporation designs, develops, markets, installs, hosts, and supports healthcare information technology, healthcare devices, hardware, and content solutions for healthcare organizations and consumers worldwide. CERN has a PE ratio of 51.5. Currently there are 19 analysts that rate Cerner a buy, 1 analyst rates it a sell, and 4 rate it a hold.

The average volume for Cerner has been 1.5 million shares per day over the past 30 days. Cerner has a market cap of $22.0 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.00 and a short float of 4.6% with 10.76 days to cover. Shares are up 16.7% year-to-date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Cerner as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Health Care Technology industry average. The net income increased by 11.8% when compared to the same quarter one year prior, going from $115.34 million to $129.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 21.1%. Since the same quarter one year prior, revenues rose by 15.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CERN's debt-to-equity ratio is very low at 0.04 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 2.90, which clearly demonstrates the ability to cover short-term cash needs.
  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • 48.05% is the gross profit margin for CERNER CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.35% is above that of the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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