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Cerner Corp CERN

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Cerner Posts In Line Quarter and Commences Search for Next CEO; Expands Share Buyback Program

Dylan Finley Associate Equity Analyst

Analyst Note

| Dylan Finley |

In tandem with the earnings release, wide-moat Cerner dropped several noteworthy announcements, including the search for a new CEO. Current CEO Brent Shafer joined Cerner in 2018 and has helped lead the company forward in simplifying and improving the mix of services to better match the times by acquiring new technologies. Shafer and Cerner's board are in cooperation to place his successor, and this move follows several other shuffles in the C-suite over the past year. Cerner has made progress in clarifying its strategy and improving services, and seeks to continue to smooth out operations with a new chief. This move follows recent headwinds--it was announced in March 2021 that the Veteran's Association (VA) would temporarily pause the $16 billion rollout of its modernization project with Cerner, while a review is launched. The VA Inspector General has noted several issues with implementation thus far--partially as a result of the agency's preparedness--resulting in higher costs, delays, and frustration among clinicians. Cerner fully supports the VA's review and expects these near-term headwinds to cut 1% off 2021 revenue growth. In other news, Cerner announced an expansion in its capital return program, raising expectations to $1.5 billion in share buybacks in 2021 (versus prior guidance of $1 billion in February).

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Company Profile

Business Description

Cerner is a leading supplier of healthcare information technology solutions and tech-enabled services. The company offers a wide range of intelligent solutions and tech-enabled services that support the clinical, financial, and operational needs of healthcare organizations of varying sizes. The company employs nearly 30,000 associates and has a strong global installed base, including the lion's share of the top 100 health systems, physician practices, laboratories, ambulatory centers, behavioral health centers, cardiac facilities, radiology clinics, surgery centers, extended-care facilities, retail pharmacies, and employer sites. The company is guided by the mission of the founding partners to provide seamless medical records across all healthcare providers to improve outcomes.

Contact
2800 Rockcreek Parkway
North Kansas City, MO, 64117
T +1 816 221-1024
Sector Healthcare
Industry Health Information Services
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 28, 2020
Stock Type Slow Growth
Employees 26,400

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