Ahead of the Bell: Analyst upgrades Allscripts
Shares of Allscripts Healthcare have room for growth as the company develops its population health management business, according to a Citi, which raised its rating on the stock Tuesday.
Analyst George Hill also raised his price target to $18 from $12.50. He said the company's population health technology will start contributing to bookings and revenue next year, and that may not be reflected in the stock right now.
"We believe there is a potential for earnings upside in 2014 if population health solutions contribute more significantly or quickly than we expect," Hill wrote.
The stock climbed nearly 2 percent, or 26 cents, to $13.87 Tuesday before markets opened.
Shares had slipped last week after Allscripts reported a first-quarter loss. Adjusted earnings and revenue fell short of expectations.
But Hill said recent acquisitions and new product launches should help the company, and he upgraded the Chicago company's stock to "buy" from "neutral."
Allscripts Healthcare Solutions Inc. said in March that it had acquired dbMotion Ltd., which combines information from many IT sources into a single patient record to coordinate care; and Jardogs LLC, which offers technology that helps patients monitor their health and allows patients, physicians, and caregivers to stay in touch through secure messaging.
Allscripts also said last December that board member Paul M. Black would become president and CEO.
Hill also believes that recent management changes will improve the information technology company's operations and customer service "in a number of important ways."