UPDATE: Oppenheimer Upgrades Quality Systems to Outperform, Establishes $20 PT
In a report published Friday, Oppenheimer Holdings upgraded its rating on Quality Systems (NASDAQ: QSII) from Perform to Outperform, and established a $20.00 price target.
Oppenheimer noted, “QSII shares were down ~33% yesterday, following disappointing F1Q13 results. Aside from missing consensus, management raised concerns over ambulatory market saturation, reduced its pipeline estimate by $36M, and pulled F2013 guidance. While the market's concerns over these issues are all valid, we believe yesterday's reaction was overdone. We have been expecting a decline in ambulatory sales for some time. However, with expectations reset to an achievable level and what we believe is an attractive valuation, we are upgrading the shares to Outperform from Perform. We believe QSII has a solid base of recurring revenue and growth opportunities to more than offset our expectation of a decline in ambulatory EHR sales. We are establishing a $20 price target.”
Quality Systems closed on Thursday at $15.95.