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Morgan Stanley Thinks Strong 4Q Beat Bodes Well for athenahealth

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In a report published Friday, Morgan Stanley analyst Ricky R. Goldwasser reiterated an Equal-Weight rating on athenahealth (NASDAQ: ATHN).

In the report, Morgan Stanley noted, “ATHN reported 4Q revenues of $171.6M, up 47.5% y/y and 13.2% seq, vs. cons/MS est. of $168.4/$168.8M. Top-line helped by Epocrates revenues of $18.9M, up 41.2% seq vs. MS est. of $15.0M. Ex-Epoc, core ATHN revenues up 28.1% y/y and 11.0% seq vs. LT goal of 30% growth. While not disclosed, bookings met goal of 30% growth in 2013. Gross margin of 66.2% was up 284 bps y/y and 432 bps seq, vs. MS est. of 65.4%. EBIT of $34.1M was above MS est. of $30.1M and cons' $29.2M. EBIT margin of 19.9% was up 317 bps y/y and up 716 bps seq, above MS est. of 17.8%. Collector physician adds of 2,094 up 6% seq and 7% y/y and ahead of our est. of 2,055. Total Provider adds were 3,017, of which 1/3rd were from Ascension Health go lives (~1,000 out of ~4,000 providers). Hospital Physician Partners (HPP), the next largest deal in the implementation pipeline at ~2,000 providers is expected to go live starting in 2014. Clinical adds of 987 were up 12.4% y/y and 8.7% seq. ATHN signed 6 population health management deals for Clarity, which is now being rebranded as part of a broader Coordinator offering. Coordinator in-network orders grew modestly to 7.1%, after the large jump from 1.3% in 2Q to 6.7% in Q3 driven by success in signing labs to the network.”

athenahealth closed on Thursday at $139.08.

Latest Ratings for ATHN

DateFirmActionFromTo
Jul 2015Canaccord GenuityInitiates Coverage onHold
Jun 2015OppenheimerInitiates Coverage onOutperform
Mar 2015RW BairdInitiates Coverage onOutperform

View More Analyst Ratings for ATHN
View the Latest Analyst Ratings

Posted-In: Morgan Stanley Ricky R. GoldwasserAnalyst Color Reiteration Analyst Ratings

 

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