The Discussion Points Ahead of Cerner Short Call Today: This Healthcare Stock Has 30% Downside - cern 6 20 17

Join Hedgeye's Healthcare Team – led by Sector Head Tom Tobin – for a review of their SHORT Thesis on the Cerner Corporation (CERN). The call will take place on Tuesday, June 20, at 11 am ET

Email sales@hedgeye.com for more information.

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We will present the short case on CERN, where we see the base case as approximately 30% downside. We will update and expand our short thesis, including a discussion of "What's Next?" in the U.S. Department of Veterans Affairs' (VA) decision to replace their VistA EHR with Cerner (CERN) and the impact to Cerner's fundamentals. This call will feature Defense Analyst Lt. Gen. Emo Gardner to walk through the timelines, challenges and process regarding the VA implementation.  

KEY DISCUSSION POINTS:

  • Market Structure by Hospital Size and Ownership
    • Net patient revenue, licensed beds, facility type, the number of hospitals in the health system and care setting
  • Hospital EHR Pipeline Analysis
    • Number of replacement decisions by hospital size, ownership, and vendor
    • Detailed look at largest remaining deals and contract value.
    • Health systems currently out to RFP
    • New client bookings model
  • Market Share and Competition 
    • Inpatient EHR and RCM replacement drivers; winners and losers
    • Historical market share and forecast for major vendors (Epic, Cerner, MEDITECH, MEDHOST, Allscripts, McKesson, CPSI, athenahealth)
    • Installed base composition by vendor and named accounts
    • Value of the MEDITECH installed base to CERN
  • Product Penetration and Cross-Sell Opportunity
    • Historical and forecasted product penetration (RCM, lab, emergency, etc.) in the Cerner Millennium and Siemens installed base
    • Examination of the 'white space' opportunity by account and on a historical basis
    • Technology profiles of top-10 largest customers
  • Veteran Affairs and Department of Defense
    • What happens next? Insight from our Washington Policy team
    • Tracking DoD and VA contract awards
    • Contract size and structure
    • Bookings impact and timing 
  • Why New Client Bookings Matter
    • Modeling top-line using contract level detail
    • 2018 looks like the breaking point for sales growth
    • Breakdown of professional services and software sales
  • ITWorks, RevWorks, Population Health
    • Addressable market
    • Margin implications
  • Valuation, Sentiment, and Catalysts


CALL DETAILS

Ping sales@hedgeye.com for more information. Please note if you are not a current subscriber to our Healthcare research there will be a fee associated with this call.  

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