Quality Systems (QSII) Cut to “Sell” at Zacks Investment Research

Zacks Investment Research lowered shares of Quality Systems (NASDAQ:QSII) from a hold rating to a sell rating in a research report report published on Tuesday.

According to Zacks, “Quality Systems is currently being plagued by dull performance in the RCM and Electronic data interchange segments. Contracting gross margins and surging operating expenses of the company raise concern. The company’s R&D expenses have fallen indicating reduced focus on innovation. Quality Systems is also broadly exposed to integration risks. Cutthroat competition in the niche space adds to the woes. However, the company rides on the acquisitions of Entrada and Eagle Dream, which have proven accretive. Management currently foresees solid growth prospects in the RCM pipeline also. The NextGen population health analytics suite and NextGen mobile platform registered significant growth lately.  A solid bookings growth also deserves mention. Strong guidance for fiscal 2019 buoys optimism. Quality Systems has outperformed the industry in a year's time.”

Several other brokerages have also issued reports on QSII. ValuEngine upgraded Quality Systems from a hold rating to a buy rating in a report on Saturday, May 26th. BidaskClub upgraded Quality Systems from a hold rating to a buy rating in a report on Tuesday, April 10th. Cantor Fitzgerald reiterated a buy rating and issued a $23.00 price target (up previously from $21.00) on shares of Quality Systems in a report on Thursday, June 21st. Piper Jaffray Companies increased their price target on Quality Systems to $22.00 and gave the stock an overweight rating in a report on Friday, May 25th. Finally, JPMorgan Chase & Co. initiated coverage on Quality Systems in a report on Tuesday, April 24th. They issued an underweight rating and a $15.00 price target on the stock. Five investment analysts have rated the stock with a sell rating, four have given a hold rating, three have assigned a buy rating and one has given a strong buy rating to the company. The stock has a consensus rating of Hold and a consensus price target of $16.50.

Shares of Quality Systems opened at $20.15 on Tuesday, MarketBeat.com reports. Quality Systems has a one year low of $12.24 and a one year high of $20.60. The company has a debt-to-equity ratio of 0.11, a quick ratio of 1.05 and a current ratio of 1.05. The stock has a market cap of $1.29 billion, a P/E ratio of 35.35, a price-to-earnings-growth ratio of 4.11 and a beta of 0.75.

Quality Systems (NASDAQ:QSII) last announced its earnings results on Thursday, May 24th. The company reported $0.16 EPS for the quarter, beating the consensus estimate of $0.13 by $0.03. Quality Systems had a return on equity of 10.88% and a net margin of 0.46%. The company had revenue of $135.80 million for the quarter, compared to analyst estimates of $131.95 million. During the same quarter in the prior year, the company earned $0.21 EPS. The firm’s revenue for the quarter was up 2.2% compared to the same quarter last year. equities research analysts expect that Quality Systems will post 0.6 earnings per share for the current fiscal year.

Several hedge funds have recently bought and sold shares of the company. Allianz Asset Management GmbH bought a new position in shares of Quality Systems in the first quarter valued at approximately $163,000. Foundry Partners LLC lifted its holdings in shares of Quality Systems by 6.6% in the first quarter. Foundry Partners LLC now owns 311,381 shares of the company’s stock valued at $4,250,000 after purchasing an additional 19,276 shares in the last quarter. Clearline Capital LP bought a new position in shares of Quality Systems in the first quarter valued at approximately $320,000. Citadel Advisors LLC lifted its holdings in shares of Quality Systems by 133.8% in the first quarter. Citadel Advisors LLC now owns 615,800 shares of the company’s stock valued at $8,406,000 after purchasing an additional 352,411 shares in the last quarter. Finally, GSA Capital Partners LLP bought a new position in shares of Quality Systems in the first quarter valued at approximately $516,000. Institutional investors own 70.24% of the company’s stock.

Quality Systems Company Profile

Quality Systems, Inc, together with its subsidiaries, develops and markets software and services that automate various aspects of practice management (PM) and electronic health records for medical and dental practices in the United States. The company's NextGen division provides integrated clinical, financial, and connectivity solutions for ambulatory and dental provider organizations.

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