NasdaqGS:CERN

Stock Analysis Report

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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

Solid track record with excellent balance sheet.


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 +/- 3% a week.

Volatility Over Time: CERN's weekly volatility (3%) has been stable over the past year.


Market Performance


7 Day Return

-3.4%

CERN

-11.4%

US Healthcare Services

-3.6%

US Market


1 Year Return

-0.2%

CERN

63.7%

US Healthcare Services

36.4%

US Market

Return vs Industry: CERN underperformed the US Healthcare Services industry which returned 63.8% over the past year.

Return vs Market: CERN underperformed the US Market which returned 38.5% over the past year.


Shareholder returns

CERNIndustryMarket
7 Day-3.4%-11.4%-3.6%
30 Day-14.3%-6.9%0.9%
90 Day-6.7%9.5%6.7%
1 Year0.9%-0.2%64.2%63.7%39.4%36.4%
3 Year11.9%9.9%140.6%138.8%53.4%43.5%
5 Year36.4%33.9%264.6%260.5%117.3%93.0%

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?

26.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CERN ($69.14) is trading below our estimate of fair value ($94.31)

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 (27.2x) compared to the US Healthcare Services industry average (128.8x).

PE vs Market: CERN is poor value based on its PE Ratio (27.2x) compared to the US market (21.3x).


Price to Earnings Growth Ratio

PEG Ratio: CERN is poor value based on its PEG Ratio (2.9x)


Price to Book Ratio

PB vs Industry: CERN is good value based on its PB Ratio (4.7x) compared to the US Healthcare Services industry average (5.4x).


Next Steps

Future Growth

How is Cerner forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

9.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CERN's forecast earnings growth (9.3% per year) is above the savings rate (2%).

Earnings vs Market: CERN's earnings (9.3% per year) are forecast to grow slower than the US market (20.3% per year).

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

Revenue vs Market: CERN's revenue (5.3% per year) is forecast to grow slower than the US market (10.4% per year).

High Growth Revenue: CERN's revenue (5.3% 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 (24.2%)


Next Steps

Past Performance

How has Cerner performed over the past 5 years?

0.08%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CERN has high quality earnings.

Growing Profit Margin: CERN's current net profit margins (14.2%) are higher than last year (9.3%).


Past Earnings Growth Analysis

Earnings Trend: CERN's earnings have grown by 0.08% per year over the past 5 years.

Accelerating Growth: CERN's earnings growth over the past year (47.6%) exceeds its 5-year average (0.08% per year).

Earnings vs Industry: CERN earnings growth over the past year (47.6%) exceeded the Healthcare Services industry -23.6%.


Return on Equity

High ROE: CERN's Return on Equity (17.4%) is considered low.


Next Steps

Financial Health

How is Cerner's financial position?


Financial Position Analysis

Short Term Liabilities: CERN's short term assets ($2.7B) exceed its short term liabilities ($1.2B).

Long Term Liabilities: CERN's short term assets ($2.7B) exceed its long term liabilities ($1.9B).


Debt to Equity History and Analysis

Debt Level: CERN's debt to equity ratio (30.6%) is considered satisfactory.

Reducing Debt: CERN's debt to equity ratio has increased from 13.2% to 30.6% over the past 5 years.

Debt Coverage: CERN's debt is well covered by operating cash flow (104.6%).

Interest Coverage: CERN's interest payments on its debt are well covered by EBIT (4642.7x coverage).


Balance Sheet


Next Steps

Dividend

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

1.27%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CERN's dividend (1.27%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.34%).

High Dividend: CERN's dividend (1.27%) is low compared to the top 25% of dividend payers in the US market (3.76%).


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 (29.9%), 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 (23.7% payout ratio).


Next Steps

Management

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

3.0yrs

Average management tenure


CEO

David Shafer (63 yo)

3yrs

Tenure

US$12,538,797

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 ($USD12.54M) is about average for companies of similar size in the US market ($USD10.54M).

Compensation vs Earnings: David's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
David Shafer
Chairman & CEO3yrsUS$12.54m0.00012%
$ 25.4k
Donald Trigg
President1yrUS$6.70m0.00062%
$ 131.3k
Marc Naughton
Executive Advisorno dataUS$4.20m0.0077%
$ 1.6m
John Peterzalek
Executive Senior Advisorno dataUS$4.41m0.0082%
$ 1.7m
Michael Robin
Partner and Vice President 4.83yrsno datano data
Mark Erceg
Executive VP & CFOno datano data0.0035%
$ 737.0k
Michael Battaglioli
VP & Chief Accounting Officer11.75yrsno data0.0012%
$ 258.4k
Jerome Labat
Executive VP & CTO0.67yrno datano data
Bill Graff
Senior VP & Chief Information Officer4.83yrsno datano data
Allan Kells
Vice Presidentno datano datano data
Daniel Devers
Executive VP & Chief Legal Officer0.083yrno data0.00026%
$ 55.1k
Misti Preston
Director of External Communications & Public Relationsno datano datano data

3.0yrs

Average Tenure

53yo

Average Age

Experienced Management: CERN's management team is considered experienced (3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
David Shafer
Chairman & CEO3yrsUS$12.54m0.00012%
$ 25.4k
William Zollars
Lead Independent Director1.83yrsUS$371.73k0.0087%
$ 1.8m
Mitchell Daniels
Independent Director7.17yrsUS$345.48k0.011%
$ 2.4m
Gerald Bisbee
Independent Director33yrsUS$356.73k0.018%
$ 3.8m
R. Wise
Independent Director1.83yrsUS$568.54k0.0061%
$ 1.3m
Linda Dillman
Independent Director10.75yrsUS$344.23k0.0084%
$ 1.8m
John Greisch
Independent Director1.83yrsUS$585.42k0.0066%
$ 1.4m
George Riedel
Independent Director1.83yrsUS$572.29k0.0011%
$ 235.1k
Melinda Mount
Independent Director1.83yrsUS$572.29k0.0037%
$ 783.6k
Julie Gerberding
Independent Director3.92yrsUS$337.54k0.0039%
$ 819.6k
Elder Granger
Independent Director0.25yrno data0.0016%
$ 345.2k

1.8yrs

Average Tenure

65yo

Average Age

Experienced Board: CERN's board of directors are not considered experienced ( 1.8 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 bought more shares than they have sold 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$21.177b
  • Shares outstanding: 306.29m
  • Website: https://www.cerner.com

Number of Employees


Location

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

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CERNNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDDec 1986
CREDB (Deutsche Boerse AG)YesCommon StockDEEURDec 1986
0R00LSE (London Stock Exchange)YesCommon StockGBUSDDec 1986
CERN *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNDec 1986
CERNWBAG (Wiener Boerse AG)YesCommon StockATEURDec 1986
CREETLX (Eurotlx)YesCommon StockITEURDec 1986
C1ER34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 SHS UNSPONBRBRLJan 2020

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 Analysis2021/02/28 00:21
End of Day Share Price2021/02/26 00:00
Earnings2020/12/31
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.