Will Black Magic Be Good For Allscripts Healthcare Solutions?

December 22, 2012

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E = Equity to Debt Ratio Is Normal

The debt-to-equity ratio for Allscripts Healthcare Solutions is normal, but it’s not as strong as the debt-to-equity ratios for Cerner and Quality Systems Inc. (SQII).

	Debt-To-Equity	Cash	Long-Term Debt
MDRX	.36	$93.67 Million	$461.67 Million
CERN	.07	$1.04 Billion	$196.66 Million
QSII	.00	$127.26 Million	$0

T = Technicals on the Stock Chart Are Weak

Allscripts Healthcare Solutions has performed poorly over the past three years, especially compared to Cerner. It was time for a change.

	1 Month	Year-To-Date	1 Year	3 Year
MDRX	-26.07%	-51.80%	-49.25%	-52.27%
CERN	2.91%	31.05%	34.05%	106.10%
QSII	4.94%	-48.44%	-48.13%	-34.19%

At $9.14, Allscripts Healthcare Solutions is currently trading well below all its averages.

50-Day SMA	12.42
100-Day SMA	11.65
200-Day SMA	12.30

E = Earnings Have Disappointed, But Revenue Has Increased

Anytime revenue is increasing, there is potential for a turnaround as long as the right management is in place.

	2007	2008	2009	2010	2011
Revenue ($)in millions	281.91	383.77	548.44	613.31	1.44B
Diluted EPS ($)	.35	.31	.21	-.03	.39

When we look at last quarter on a YoY basis, we see a decrease in revenue and earnings. At least there is room for improvement. However, this shouldn’t rattle investors.

	9/2011	12/2011	3/2012	6/2012	9/2012
Revenue ($)in millions	363.74	388.20	364.71	369.96	360.69
Diluted EPS ($)	.10	.14	.03	.04	.05

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