UPDATE: Stifel Resumes athenahealth (ATHN) at Hold
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(Updated - August 31, 2016 9:32 AM EDT)
Stifel resumed coverage on athenahealth (NASDAQ: ATHN) with a Hold rating. Analyst David M. Grossman thinks the company has a compelling model, but he highlighted "growing pains."
"ATHN is best known for providing outsourced revenue cycle management to physicians. They are differentiated by their revenue model, which is a fee rate applied to successful collection from payers ... ATHN’s broader goal is to become the information backbone for the U.S. healthcare system by becoming the dominant outsourced back office to U.S. healthcare providers. If successful, they become an open, central repository for its clients’ patient clinical and financial information across the continuum of care—or in their words, they become the healthcare 'Internet' for their clients," noted the analyst.
"In our view, ATHN’s aspirations are ambitious and compelling. We respect their role as an industry disrupter, appreciate their transparency and genuinely would like them to succeed. That said, our market neutral rating reflects a lack of visibility on how certain transitions within the business may impact growth and their multiple, and a desire to see further evidence that its model can scale differently than its peers," added Grossman.
Shares of athenahealth closed at $122.46 yesterday.
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