UBS Maintains a 'Sell' on athenahealth (ATHN); Decent Quarter, But Valuation Too High

July 20, 2012 3:05 PM EDT Send to a Friend
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Price: $144.44 +0.21%

Rating Summary:
    15 Buy, 13 Hold, 4 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 3 | Down: 4 | New: 7
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UBS maintains a 'Sell' on athenahealth (NASDAQ: ATHN) price target of $58.00 (from $34.00).

Analyst, Stephen Shankman, said, "In our view, expectations are (and should be) high for a stock trading at 66x 2013e EPS and we believe ATHN 2Q12 results were solid, but not overwhelmingly positive...Without the recent HMA (NYSE: HMA) (enterprise) deal announcement, 2Q results may have come under greater scrutiny, in our view."

Shankman now values ATHN with a cloud-based/Saas PE multiple (vs. other HCIT). Therefore at 45x new UBS FY13 EPS estimate of $1.29 (from $1.28), the new price target is $58 (well below current price)

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 $87.18 yesterday.




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