Stock in Focus: Computer Programs and Systems, Inc. (CPSI)

Company Profile:

Computer Programs and Systems, Inc. (CPSI) is a provider of healthcare information technology solutions for rural and community hospitals, with over 650 client hospitals in 46 states and the District of Columbia. The Company provides enterprise-wide clinical management, access management, patient financial management, health information management, strategic decision support, resource planning management and enterprise application integration solutions to healthcare organizations throughout the United States. Additionally, CPSI provides other information technology solutions, including business management services, remote hosting, networking technologies and other related services. The company was founded in 1979 and is headquartered in Mobile, Alabama.

Recent News:

Computer Programs and Systems Inc. reported second-quarter earnings of $5.8 million. On a per-share basis, it had profit of 52 cents. Its Board of Directors has declared a regular quarterly cash dividend of $0.64 per share, payable on August 28, 2015, to stockholders of record as of the close of business on August 13, 2015.

Computer Programs and Systems Inc. expects full-year earnings to be $2.05 to $2.17 per share, with revenue in the range of $188 million to $192 million.

Fundamental Analysis:

Ninestocks analyzes several different financial aspects: Growth, Profitability, solvency and efficiency.

Growth – Measures the growth of both the company’s income statement and cash flow.

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Profitability – Measures the historical price movement of the stock.

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Solvency – Measures the solvency of the company based on several ratios.

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Efficiency – Measures the strength and historic growth of a company’s return on invested capital.

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Conclusion:

CPSI’s strengths can be seen in its strong profitability and better efficiency. Its revenue and net income have increased over several years. Technical indicators signal the bullish signs, as there is a bullish cross in MACD and Stochastic Oscillator. RSI is increasing to 44.21. The current P/E ratio indicates it is undervalued compared to the average P/E ratio of the sector. We rate Computer Programs & Systems Inc. (CPSI) a Strong BUY.