UPDATE: JP Morgan Initiates Quality Systems at Underweight on Operational Risks

JP Morgan initiated coverage on Quality Systems

with an Underweight rating and an $18 price target. JP Morgan commented, "While QSII is trading at a ~37% discount to peers, we believe this is warranted given both recent business trends and disruptions created by management changes. Quality Systems does have a solid customer base in the physician practice market and is investing to grow its presence in the in-patient and RCM markets. That said, new business trends have been negative in recent quarters and until we see positive data points to indicate improvements in core operations and/or a clear strategic plan from management, we believe the risks to Quality Systems' business are too great to be ignored." Quality Systems closed at $17.89 on Wednesday.