Oppenheimer analyst Mohan Naidu maintained a Buy rating on Athenahealth (NASDAQ: ATHN) today and set a price target of $179. The company’s shares closed yesterday at $158.49, close to its 52-week high of $163.94.
Naidu said:
“The CEO’s departure last week makes us believe in the increased likelihood of a transaction. athenaNet is the only healthcare cloud network and we expect this to be the basis for a true healthcare cloud and ecosystem that can facilitate yet uncontemplated monetization opportunities. While there is significant discussion about potential suitors, we make a case for the data-hungry tech companies. Tech innovation, especially in machine learning/AI, in healthcare is severely handicapped due to the lack of access to analyzable clinical and claims data, which we think ATHN can solve. Based on the recent SaaS transactions (Exhibit 1), we expect the range, at the minimum, to be $179-197/share representing 5–5.5x our EV/CY19E revenue. We remain Outperform-rated, but increase our price target from $158 to $179.”
According to TipRanks.com, Naidu is a 5-star analyst with an average return of 11.9% and a 59.4% success rate. Naidu covers the Services sector, focusing on stocks such as Tivity Health Inc, Hms Holdings Corp, and Express Scripts.
Currently, the analyst consensus on Athenahealth is Moderate Buy and the average price target is $158, representing a -0.3% downside.
In a report issued on June 6, Piper Jaffray also maintained a Buy rating on the stock with a $179 price target.
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Athenahealth’s market cap is currently $6.4B and has a P/E ratio of 75.47. The company has a Price to Book ratio of 6.58.
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athenahealth, Inc. engages in the provision of cloud-based business services and mobile applications for medical groups and health systems. It offers network-based medical record, revenue cycle, patient engagement, care coordination, population health services, and other point-of-care mobile applications.
