In a report published Thursday, KeyBanc Capital Markets analyst Donald Hooker downgraded the rating on Computer Programs & Systems CPSI from Hold to Underweight, but reiterated the $55.00 price target.
In the report, KeyBanc Capital Markets noted, “We downgrade CPSI from Hold to UNDERWEIGHT ($55PT) as we believe the Street's growth expectations around the Co.'s core small hospital IT systems business are too optimistic. Our view stems from our analysis of growth opp'ties in the small hospital market, which we believe is increasingly saturated (i.e., new / bolt-on deployments rather limited), and experiencing greater competition for replacement (i.e., market share) opp'ties.
"We maintain our below-consensus ‘15 revenue growth (-160 bps) and EPS ests. (-5%).”
Computer Programs & Systems closed on Wednesday at $65.70.
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