Buy Press Ganey? BMO Capital Says It's Time

Press Ganey Holdings Inc PGND, formerly PGA Holdings, went public last month and now, the silent period is over. Consequently, a few major Wall Street research firms have weighed in on the stock.

Analysts at Barclays initiated coverage with an Overweight rating, while Baird experts assumed coverage with a Neutral rating and a $30.00 price target. For its part, Raymond James issued an Outperform rating. BMO also shared some color on the stock.

BMO Capital Commentary

The firm initiated coverage of Press Ganey with an Outperform rating and a $31.00 price target.

Analysts Jeffrey M. Silber and Henry Sou Chien highlighted the company’s 62 percent market share in patient experience measurement services across all U.S. acute hospitals. “The company retains one of largest patient experience industry data assets and provides best-in-class survey methodologies and analytics," they write.

Silber and Chien see the company benefitting from “secular industry tailwinds, as patient experience metrics become an increasingly important component of financial and operational performance under a value-based health care payment system.”

The company’s management team has been developing a robust suite of services over the past few years, which should result in considerable upsell opportunities, the analysts add. Because of this, they expect Press Ganey to outperform its peers in terms of top-line growth, delivering more than the industry's 6 percent average.

Silber and Chien note that they like Press Ganey for its "visible" and "recurring" revenue model, sticky services and "scalable" assets.

BMO anticipates earnings of $0.89 per share for 2015 and EPS of $1.00 for 2016.