Suspension Of Services At Cook County Hospital To Be Viewed Negatively For MDAS

Analysts at JP Morgan maintain their "neutral" rating on MedAssets MDAS, while reducing their estimates for the company. The target price for MDAS is set to $32. JP Morgan says, “MDAS reported 2Q non-GAAP EPS of $0.17, in line with our estimate and consensus. Total revenue was slightly ahead of expectations, but RCM revenue was lighter. Other line items were largely in line with expectations. We would characterize the quarter as in line with expectations and uneventful.” “Commentary on the call around pipeline was generally positive, but management noted on the conference call that it had suspended services at Cook County hospital owing to deep financial constraints at the hospital. While not material to earnings, we believe this news is likely to be viewed negatively, and may offset some of the positive commentary around the pipeline…. We like the company’s growth prospects and positioning in the market, and while we expect the shares to be up on an absolute basis over the next 12 moths, we expect them to perform in line with the RCM space,” the analysts add. JP Morgan has lowered its EPS estimates for FY11 from $1.09 to $1.07. More Analyst Ratings here