NasdaqGS:CERN

Stock Analysis Report

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Market Cap

US$23.9b

Last Updated

2021/06/17 05:07 UTC

Data Sources

Company Financials +

Executive Summary

Cerner Corporation, together with its subsidiaries, provides health care information technology solutions and tech-enabled services in the United States and internationally. More Details


Snowflake Analysis

Good value with proven track record.


Similar Companies

Share Price & News

How has Cerner's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CERN is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: CERN's weekly volatility (2%) has been stable over the past year.


Market Performance


7 Day Return

-2.2%

CERN

1.1%

US Healthcare Services

0.2%

US Market


1 Year Return

13.7%

CERN

23.5%

US Healthcare Services

39.7%

US Market

Return vs Industry: CERN underperformed the US Healthcare Services industry which returned 23.5% over the past year.

Return vs Market: CERN underperformed the US Market which returned 39.7% over the past year.


Shareholder returns

CERNIndustryMarket
7 Day-2.2%1.1%0.2%
30 Day1.8%12.9%2.5%
90 Day10.2%2.7%5.9%
1 Year14.7%13.7%23.7%23.5%41.9%39.7%
3 Year35.2%32.3%114.4%112.8%59.7%49.8%
5 Year42.4%39.4%237.2%233.2%125.6%100.3%

Long-Term Price Volatility Vs. Market

How volatile is Cerner's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Cerner undervalued compared to its fair value and its price relative to the market?

34.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CERN ($79.3) is trading below our estimate of fair value ($121.1)

Significantly Below Fair Value: CERN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CERN is good value based on its PE Ratio (30.1x) compared to the US Healthcare Services industry average (110.3x).

PE vs Market: CERN is poor value based on its PE Ratio (30.1x) compared to the US market (19.6x).


Price to Earnings Growth Ratio

PEG Ratio: CERN is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: CERN is good value based on its PB Ratio (5.5x) compared to the US Healthcare Services industry average (6.7x).


Future Growth

How is Cerner forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

12.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CERN's forecast earnings growth (12.7% per year) is above the savings rate (2%).

Earnings vs Market: CERN's earnings (12.7% per year) are forecast to grow slower than the US market (15.6% per year).

High Growth Earnings: CERN's earnings are forecast to grow, but not significantly.

Revenue vs Market: CERN's revenue (5.7% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: CERN's revenue (5.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CERN's Return on Equity is forecast to be high in 3 years time (28.8%)


Past Performance

How has Cerner performed over the past 5 years?

0.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CERN has a large one-off gain of $179.4M impacting its March 31 2021 financial results.

Growing Profit Margin: CERN's current net profit margins (14.7%) are higher than last year (8.9%).


Past Earnings Growth Analysis

Earnings Trend: CERN's earnings have grown by 0.1% per year over the past 5 years.

Accelerating Growth: CERN's earnings growth over the past year (57.8%) exceeds its 5-year average (0.1% per year).

Earnings vs Industry: CERN earnings growth over the past year (57.8%) exceeded the Healthcare Services industry 26.9%.


Return on Equity

High ROE: CERN's Return on Equity (18.7%) is considered low.


Financial Health

How is Cerner's financial position?


Financial Position Analysis

Short Term Liabilities: CERN's short term assets ($3.1B) exceed its short term liabilities ($1.5B).

Long Term Liabilities: CERN's short term assets ($3.1B) exceed its long term liabilities ($2.1B).


Debt to Equity History and Analysis

Debt Level: CERN's debt to equity ratio (40.5%) is considered high.

Reducing Debt: CERN's debt to equity ratio has increased from 12.8% to 40.5% over the past 5 years.

Debt Coverage: CERN's debt is well covered by operating cash flow (91.8%).

Interest Coverage: CERN's interest payments on its debt are well covered by EBIT (4752.7x coverage).


Balance Sheet


Dividend

What is Cerner current dividend yield, its reliability and sustainability?

1.11%

Current Dividend Yield


Upcoming Dividend Payment

TodayJun 17 2021Ex Dividend DateJun 25 2021Dividend Pay DateJul 13 202118 days from Ex DividendBuy in the next 7 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: CERN's dividend (1.11%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.27%).

High Dividend: CERN's dividend (1.11%) is low compared to the top 25% of dividend payers in the US market (3.36%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, CERN has been paying a dividend for less than 10 years.

Growing Dividend: CERN's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (30.3%), CERN's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CERN's dividends in 3 years are forecast to be well covered by earnings (23.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.5yrs

Average management tenure


CEO

David Shafer (63 yo)

3.33yrs

Tenure

US$9,820,852

Compensation

Mr. David Brent Shafer has been Chairman and Chief Executive Officer of Cerner Corporation since February 1, 2018. Mr. Shafer served as Executive Vice President of North American Market at Koninklijke Phil...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD9.82M) is about average for companies of similar size in the US market ($USD11.27M).

Compensation vs Earnings: David's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: CERN's management team is not considered experienced ( 1.5 years average tenure), which suggests a new team.


Board Members

Experienced Board: CERN's board of directors are not considered experienced ( 2.2 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CERN insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Cerner Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Cerner Corporation
  • Ticker: CERN
  • Exchange: NasdaqGS
  • Founded: 1979
  • Industry: Health Care Technology
  • Sector: Healthcare
  • Market Cap: US$23.894b
  • Shares outstanding: 301.32m
  • Website: https://www.cerner.com

Number of Employees


Location

  • Cerner Corporation
  • 2800 Rockcreek Parkway
  • North Kansas City
  • Missouri
  • 64117-2551
  • United States

Listings


Biography

Cerner Corporation, together with its subsidiaries, provides health care information technology solutions and tech-enabled services in the United States and internationally. The company offers Cerner Mille...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/06/17 05:07
End of Day Share Price2021/06/16 00:00
Earnings2021/03/31
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.