Cerner Corporation (CERN): Street Finally Waking Up


    BlackRock Fund Advisors recently announced the acquisition of new stake in Cerner Corporation (NASDAQ:CERN). The institutional investor has increased its shareholding in the Healthcare company by 0.24% to 16.18 million shares with purchase of 38132.0 shares. This fresh investment now brings its stake to 5.32% valued currently at $1.11 billion. In addition, SSgA Funds Management, Inc. raised its holdings by 0.29 million to 14.71 million shares. And Walter Scott & Partners Ltd. has lifted its position by 0.64% or 70991.0 shares – to 11.09 million shares.

    With over 2.03 million Cerner Corporation (CERN) shares trading Friday and a closing price of $69.45 on the day, the dollar volume was approximately $141.25 million. The shares have shown a negative weekly performance of -3.26% and its price on 07/31/20 lost nearly -2.54%. Currently, there are 309.66M common shares owned by the public and among those 303.85M shares have been available to trade.

    An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 26 analysts who have offered their price forecasts for CERN have a consensus price objective of $77.22. The analysts have set the share’s price value over the next 12 months at a high of $88.00 and a low of $62.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Cerner Corporation stock is 2.10 for the next 12 months. The average price target is 9.05% above its last price level and an upside to the estimated low will see the stock lose -12.02% over that period. But an upside of 21.08% will see the stock hit the forecast high price target while mean target price for the stock is $78.00.

    Insiders at the company have transacted a total of 111 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 67 of these insider trades were purchases, accounting for 1,451,615 shares. Insider sales of the common stock occurred on 44 occasions, with total insider shares sold totaling 1,561,716 shares.

    The top 3 mutual fund holders in Cerner Corporation are Vanguard Health Care Fund, Vanguard Total Stock Market Index, and Vanguard Mid Cap Index Fund. Vanguard Health Care Fund owns 9.16 million shares of the company’s stock, all valued at over $627.81 million. Vanguard Total Stock Market Index bought 71943.0 shares to see its total holdings expand to 8.67 million shares valued at over $594.42 million and representing 2.85% of the shares outstanding. Vanguard Mid Cap Index Fund sold -0.26 million shares to bring its total holdings to over 7.53 million shares at a value of $515.92 million. Vanguard Mid Cap Index Fund now owns shares totaling to 2.47% of the shares outstanding.

    Shares of Cerner Corporation (NASDAQ: CERN) opened at $71.04, down -$0.22 from a prior closing price of $71.26. However, the script later closed the day at $69.45, down -2.54%. The company’s stock has a 5-day price change of -3.26% and 4.11% over the past three months. CERN shares are trading -5.37% year to date (YTD), with the 12-month market performance down to -3.45% lower. It has a 12-month low price of $53.08 and touched a high of $80.90 over the same period. Currently, 2.03 million shares have been traded, compared to an average intraday trading volume of 2.07 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by -2.28%, -1.36%, and -0.71% respectively.

    Institutional ownership of Cerner Corporation (NASDAQ: CERN) shares accounts for 86.30% of the company’s 309.66M shares outstanding. Mutual fund holders own 38.22%, while other institutional holders and individual stakeholders account for 48.20% and 12.26% respectively.

    It has a market capitalization of $21.24B and a beta (3y monthly) value of 0.87. The stock’s trailing 12-month PE ratio is 43.16, while the earnings-per-share (ttm) stands at $1.61. The company has a PEG of 3.27 and a Quick Ratio of 1.90 with the debt-to-equity ratio at 0.00. Price movements for the stock have been influenced by the stock’s volatility, which stands at 3.41% over the week and 2.08% over the month.

    Analysts forecast that Cerner Corporation (CERN) will achieve an EPS of $0.71 for the current quarter, $0.78 for the next quarter and $3.25 for 2021. The lowest estimate earnings-per-share for the quarter is $0.67 while analysts give the company a high EPS estimate of $0.74. Comparatively, EPS for the current quarter was $0.66 a year ago. Earnings per share for the fiscal year are expected to decrease by -12.70%, and 16.65% over the next financial year. EPS should grow at an annualized rate of 13.21% over the next five years, compared to 1.90% over the past 5-year period.

    If you are looking to buy this stock, then you may note that the average analyst recommendation by 26 brokerage firm advisors rate Cerner Corporation (CERN) as a “Moderate Buy” at a consensus score of 2.10. Specifically, 15 Wall Street analysts polled rate the stock as a buy, while 8 of the 26 advise that investors “hold,” and 1 rated it as a “Sell.”

    Looking at the support for the CERN, a number of firms have released research notes about the stock. Stephens stated their Equal-Weight rating for the stock in a research note on July 07, 2020, with the firm’s price target at $75. Evercore ISI coverage for the Cerner Corporation (CERN) stock in a research note released on June 15, 2020 offered a In-line rating with a price target of $70. SunTrust was of a view on May 01, 2020 that the stock is Hold, while Jefferies gave the stock Buy rating on April 22, 2020, issuing a price target of $75- $90. SVB Leerink on their part issued Outperform rating on April 13, 2020.


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