Canaccord Genuity Remains Sidelined on Athenahealth, Inc. (ATHN) Following 2Q15

Canaccord Genuity reiterated a Hold rating and $125.00 price target on athenahealth (NASDAQ: ATHN) following 2Q15 results. Analyst Richard Close expects ATHN's differentiated cloud offerings to gain market share as physicians seek cost effective SaaS platforms.

Close commented, "As previously stated, we expect ATHN's differentiated cloud offerings to gain market share as physicians seek to replace 1st generation financial and clinical systems with cost effective SaaS platforms. This was evidenced by the NY-Presbyterian win. Our position to stay-on-the-sidelines with a HOLD rating was in large part related to waiting for success with the new hospital expansion strategy and we are encouraged by early results. With respect to 2H15, we do have some concern regarding ATHN's ability to meet doc add expectations (3QE 2,551 and 4QE 2,780) in order to drive '15 business services revenue of $915.9M. While Trinity and NY-Pres. should provide some contribution (Ascension Collector is completed), additional near-term wins will be needed."

Close also added, "We are raising our estimates following 2Q results (that beat our forecasts) to reflect mgmt commentary on guidance, with results expected at-or-above the mid-point of the range. We now project FY15 revenue of $915.9M (was $913.1M) and adj.-EPS of $1.23 (was $1.15). For FY16, we forecast revenue of $1.112B (was $1.098B) and adj.-EPS of $1.50 (was $1.46). In FY17 we now forecast revenue of $1.346B (was $1.328B) and adj.-EPS of $1.82 (was $1.77)."

For an analyst ratings summary and ratings history on athenahealth click here. For more ratings news on athenahealth click here.

Shares of athenahealth closed at $128.97 yesterday.

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