Intrinsic value of Cerner - CERN

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$68.32

  Intrinsic Value

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  Value-price divergence*

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*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of CERN stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 22.4

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  8.38
  8.40
  8.06
  7.75
  7.48
  7.23
  7.01
  6.81
  6.63
  6.46
  6.32
  6.19
  6.07
  5.96
  5.86
  5.78
  5.70
  5.63
  5.57
  5.51
  5.46
  5.41
  5.37
  5.33
  5.30
  5.27
  5.24
  5.22
  5.20
  5.18
  5.16
Revenue, $m
  4,796
  5,199
  5,618
  6,054
  6,506
  6,977
  7,466
  7,974
  8,502
  9,052
  9,623
  10,219
  10,839
  11,485
  12,158
  12,861
  13,594
  14,359
  15,158
  15,994
  16,867
  17,780
  18,735
  19,735
  20,781
  21,876
  23,023
  24,225
  25,484
  26,804
  28,187
Variable operating expenses, $m
 
  3,367
  3,632
  3,907
  4,192
  4,489
  4,798
  5,119
  5,453
  5,800
  6,161
  6,452
  6,844
  7,251
  7,677
  8,120
  8,583
  9,066
  9,571
  10,098
  10,650
  11,226
  11,829
  12,460
  13,121
  13,813
  14,537
  15,296
  16,091
  16,924
  17,797
Fixed operating expenses, $m
 
  809
  829
  850
  871
  893
  915
  938
  961
  985
  1,010
  1,035
  1,061
  1,088
  1,115
  1,143
  1,171
  1,201
  1,231
  1,261
  1,293
  1,325
  1,358
  1,392
  1,427
  1,463
  1,499
  1,537
  1,575
  1,615
  1,655
Total operating expenses, $m
  3,885
  4,176
  4,461
  4,757
  5,063
  5,382
  5,713
  6,057
  6,414
  6,785
  7,171
  7,487
  7,905
  8,339
  8,792
  9,263
  9,754
  10,267
  10,802
  11,359
  11,943
  12,551
  13,187
  13,852
  14,548
  15,276
  16,036
  16,833
  17,666
  18,539
  19,452
Operating income, $m
  911
  1,023
  1,157
  1,297
  1,443
  1,595
  1,752
  1,917
  2,088
  2,267
  2,453
  2,731
  2,934
  3,146
  3,367
  3,598
  3,839
  4,092
  4,357
  4,634
  4,924
  5,228
  5,547
  5,882
  6,233
  6,601
  6,987
  7,392
  7,818
  8,265
  8,735
EBITDA, $m
  1,415
  1,526
  1,694
  1,869
  2,051
  2,240
  2,437
  2,643
  2,856
  3,079
  3,311
  3,553
  3,806
  4,069
  4,345
  4,632
  4,933
  5,247
  5,576
  5,920
  6,281
  6,658
  7,054
  7,469
  7,904
  8,360
  8,839
  9,341
  9,868
  10,421
  11,002
Interest expense (income), $m
  18
  19
  24
  29
  34
  40
  46
  52
  58
  64
  71
  78
  85
  93
  101
  109
  118
  127
  136
  146
  156
  167
  178
  190
  202
  215
  228
  242
  257
  272
  288
Earnings before tax, $m
  918
  1,004
  1,134
  1,268
  1,409
  1,555
  1,707
  1,865
  2,030
  2,202
  2,382
  2,653
  2,849
  3,053
  3,266
  3,489
  3,722
  3,966
  4,221
  4,488
  4,768
  5,062
  5,370
  5,692
  6,031
  6,386
  6,759
  7,150
  7,561
  7,993
  8,446
Tax expense, $m
  282
  271
  306
  342
  380
  420
  461
  504
  548
  595
  643
  716
  769
  824
  882
  942
  1,005
  1,071
  1,140
  1,212
  1,287
  1,367
  1,450
  1,537
  1,628
  1,724
  1,825
  1,931
  2,042
  2,158
  2,280
Net income, $m
  636
  733
  828
  926
  1,028
  1,135
  1,246
  1,362
  1,482
  1,608
  1,739
  1,937
  2,080
  2,228
  2,384
  2,547
  2,717
  2,895
  3,081
  3,276
  3,481
  3,695
  3,920
  4,155
  4,403
  4,662
  4,934
  5,220
  5,520
  5,835
  6,166

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  356
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  5,630
  5,719
  6,180
  6,660
  7,158
  7,675
  8,213
  8,772
  9,353
  9,958
  10,587
  11,242
  11,924
  12,634
  13,375
  14,148
  14,955
  15,797
  16,676
  17,595
  18,555
  19,560
  20,611
  21,710
  22,861
  24,066
  25,328
  26,650
  28,035
  29,487
  31,009
Adjusted assets (=assets-cash), $m
  5,274
  5,719
  6,180
  6,660
  7,158
  7,675
  8,213
  8,772
  9,353
  9,958
  10,587
  11,242
  11,924
  12,634
  13,375
  14,148
  14,955
  15,797
  16,676
  17,595
  18,555
  19,560
  20,611
  21,710
  22,861
  24,066
  25,328
  26,650
  28,035
  29,487
  31,009
Revenue / Adjusted assets
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
  0.909
Average production assets, $m
  2,699
  2,927
  3,163
  3,408
  3,663
  3,928
  4,203
  4,489
  4,787
  5,096
  5,418
  5,753
  6,102
  6,466
  6,845
  7,241
  7,653
  8,084
  8,534
  9,004
  9,496
  10,010
  10,548
  11,111
  11,700
  12,316
  12,962
  13,639
  14,348
  15,091
  15,869
Working capital, $m
  774
  483
  522
  563
  605
  649
  694
  742
  791
  842
  895
  950
  1,008
  1,068
  1,131
  1,196
  1,264
  1,335
  1,410
  1,487
  1,569
  1,654
  1,742
  1,835
  1,933
  2,034
  2,141
  2,253
  2,370
  2,493
  2,621
Total debt, $m
  564
  681
  827
  980
  1,138
  1,303
  1,474
  1,651
  1,836
  2,029
  2,229
  2,437
  2,654
  2,880
  3,115
  3,361
  3,618
  3,885
  4,165
  4,457
  4,763
  5,082
  5,416
  5,766
  6,132
  6,515
  6,916
  7,337
  7,777
  8,239
  8,723
Total liabilities, $m
  1,702
  1,819
  1,965
  2,118
  2,276
  2,441
  2,612
  2,789
  2,974
  3,167
  3,367
  3,575
  3,792
  4,018
  4,253
  4,499
  4,756
  5,023
  5,303
  5,595
  5,901
  6,220
  6,554
  6,904
  7,270
  7,653
  8,054
  8,475
  8,915
  9,377
  9,861
Total equity, $m
  3,928
  3,901
  4,215
  4,542
  4,881
  5,234
  5,601
  5,983
  6,379
  6,791
  7,220
  7,667
  8,132
  8,617
  9,122
  9,649
  10,199
  10,773
  11,373
  12,000
  12,655
  13,340
  14,056
  14,806
  15,591
  16,413
  17,274
  18,175
  19,120
  20,110
  21,148
Total liabilities and equity, $m
  5,630
  5,720
  6,180
  6,660
  7,157
  7,675
  8,213
  8,772
  9,353
  9,958
  10,587
  11,242
  11,924
  12,635
  13,375
  14,148
  14,955
  15,796
  16,676
  17,595
  18,556
  19,560
  20,610
  21,710
  22,861
  24,066
  25,328
  26,650
  28,035
  29,487
  31,009
Debt-to-equity ratio
  0.144
  0.170
  0.200
  0.220
  0.230
  0.250
  0.260
  0.280
  0.290
  0.300
  0.310
  0.320
  0.330
  0.330
  0.340
  0.350
  0.350
  0.360
  0.370
  0.370
  0.380
  0.380
  0.390
  0.390
  0.390
  0.400
  0.400
  0.400
  0.410
  0.410
  0.410
Adjusted equity ratio
  0.677
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682
  0.682

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  636
  733
  828
  926
  1,028
  1,135
  1,246
  1,362
  1,482
  1,608
  1,739
  1,937
  2,080
  2,228
  2,384
  2,547
  2,717
  2,895
  3,081
  3,276
  3,481
  3,695
  3,920
  4,155
  4,403
  4,662
  4,934
  5,220
  5,520
  5,835
  6,166
Depreciation, amort., depletion, $m
  504
  503
  536
  571
  608
  646
  685
  726
  768
  812
  858
  822
  872
  924
  978
  1,034
  1,093
  1,155
  1,219
  1,286
  1,357
  1,430
  1,507
  1,587
  1,671
  1,759
  1,852
  1,948
  2,050
  2,156
  2,267
Funds from operations, $m
  1,108
  1,236
  1,364
  1,497
  1,636
  1,780
  1,931
  2,087
  2,250
  2,420
  2,597
  2,759
  2,951
  3,152
  3,362
  3,581
  3,810
  4,050
  4,300
  4,563
  4,837
  5,125
  5,427
  5,743
  6,074
  6,421
  6,786
  7,168
  7,569
  7,991
  8,433
Change in working capital, $m
  -48
  37
  39
  41
  42
  44
  45
  47
  49
  51
  53
  55
  58
  60
  63
  65
  68
  71
  74
  78
  81
  85
  89
  93
  97
  102
  107
  112
  117
  123
  129
Cash from operations, $m
  1,156
  1,337
  1,325
  1,457
  1,594
  1,737
  1,885
  2,040
  2,201
  2,369
  2,544
  2,703
  2,894
  3,092
  3,299
  3,516
  3,742
  3,979
  4,226
  4,485
  4,756
  5,040
  5,338
  5,650
  5,977
  6,319
  6,679
  7,056
  7,452
  7,868
  8,304
Maintenance CAPEX, $m
  0
  -386
  -418
  -452
  -487
  -523
  -561
  -600
  -641
  -684
  -728
  -774
  -822
  -872
  -924
  -978
  -1,034
  -1,093
  -1,155
  -1,219
  -1,286
  -1,357
  -1,430
  -1,507
  -1,587
  -1,671
  -1,759
  -1,852
  -1,948
  -2,050
  -2,156
New CAPEX, $m
  -772
  -228
  -236
  -245
  -255
  -265
  -275
  -286
  -297
  -309
  -322
  -335
  -349
  -364
  -379
  -395
  -413
  -431
  -450
  -470
  -492
  -514
  -538
  -563
  -589
  -617
  -646
  -677
  -709
  -743
  -779
Cash from investing activities, $m
  -790
  -614
  -654
  -697
  -742
  -788
  -836
  -886
  -938
  -993
  -1,050
  -1,109
  -1,171
  -1,236
  -1,303
  -1,373
  -1,447
  -1,524
  -1,605
  -1,689
  -1,778
  -1,871
  -1,968
  -2,070
  -2,176
  -2,288
  -2,405
  -2,529
  -2,657
  -2,793
  -2,935
Free cash flow, $m
  366
  724
  671
  760
  852
  949
  1,049
  1,154
  1,262
  1,376
  1,494
  1,594
  1,723
  1,857
  1,996
  2,142
  2,295
  2,454
  2,621
  2,796
  2,978
  3,170
  3,370
  3,580
  3,800
  4,031
  4,274
  4,528
  4,795
  5,075
  5,370
Issuance/(repayment) of debt, $m
  0
  143
  147
  152
  158
  165
  171
  178
  185
  192
  200
  208
  217
  226
  236
  246
  256
  268
  280
  292
  305
  319
  334
  350
  366
  383
  401
  420
  440
  462
  484
Issuance/(repurchase) of shares, $m
  -636
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  -587
  143
  147
  152
  158
  165
  171
  178
  185
  192
  200
  208
  217
  226
  236
  246
  256
  268
  280
  292
  305
  319
  334
  350
  366
  383
  401
  420
  440
  462
  484
Total cash flow (excl. dividends), $m
  -231
  866
  817
  912
  1,010
  1,113
  1,220
  1,331
  1,447
  1,568
  1,694
  1,803
  1,940
  2,083
  2,232
  2,388
  2,551
  2,722
  2,901
  3,088
  3,284
  3,489
  3,704
  3,930
  4,166
  4,415
  4,675
  4,949
  5,236
  5,537
  5,854
Retained Cash Flow (-), $m
  -58
  -303
  -314
  -327
  -340
  -353
  -367
  -381
  -396
  -412
  -429
  -447
  -465
  -485
  -505
  -527
  -550
  -574
  -600
  -627
  -655
  -685
  -717
  -750
  -785
  -822
  -861
  -902
  -945
  -990
  -1,038
Prev. year cash balance distribution, $m
 
  330
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  894
  503
  585
  671
  760
  853
  950
  1,051
  1,156
  1,265
  1,356
  1,474
  1,598
  1,727
  1,861
  2,001
  2,148
  2,301
  2,461
  2,629
  2,804
  2,988
  3,180
  3,381
  3,593
  3,814
  4,047
  4,291
  4,547
  4,816
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  857
  460
  509
  552
  589
  619
  642
  657
  664
  663
  644
  629
  608
  580
  546
  509
  467
  424
  379
  334
  290
  248
  208
  172
  140
  111
  87
  66
  50
  36
Current shareholders' claim on cash, %
  100
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

Cerner Corporation designs, develops, markets, installs, hosts, and supports health care information technology, health care devices, hardware, and content solutions for health care organizations and consumers in the United States and internationally. The company offers Cerner Millennium architecture, which includes clinical, financial, and management information systems that allow providers to access an individual’s electronic health record at the point of care, and organizes and delivers information for physicians, nurses, laboratory technicians, pharmacists, front- and back-office professionals, and consumers. It also provides HealtheIntent platform, a cloud-based platform that enables organizations to aggregate, transform, and reconcile data across the continuum of care, as well as assists to enhance outcomes and lower costs. In addition, the company offers a portfolio of clinical and financial health care information technology solutions, as well as departmental, connectivity, population health, and care coordination solutions; and various complementary services, including support, hosting, managed, implementation, and strategic consulting services. Further, it provides various services, such as implementation and training, remote hosting, operational management, revenue cycle, support and maintenance, health care data analysis, clinical process optimization, transaction processing, employer health centers, employee wellness programs, and third party administrator services for employer-based health plans; and complementary hardware and devices for third parties. It serves integrated delivery networks, physician groups and networks, managed care organizations, hospitals, medical centers, reference laboratories, home health agencies, blood banks, imaging centers, pharmacies, pharmaceutical manufacturers, employers, governments, and public health organizations. Cerner Corporation was founded in 1979 and is headquartered in North Kansas City, Missouri.

FINANCIAL RATIOS  of  Cerner (CERN)

Valuation Ratios
P/E Ratio 35.4
Price to Sales 4.7
Price to Book 5.7
Price to Tangible Book
Price to Cash Flow 19.5
Price to Free Cash Flow 58.6
Growth Rates
Sales Growth Rate 8.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 19.1%
Cap. Spend. - 3 Yr. Gr. Rate 5.7%
Financial Strength
Quick Ratio 14
Current Ratio 0
LT Debt to Equity 13.7%
Total Debt to Equity 14.4%
Interest Coverage 52
Management Effectiveness
Return On Assets 11.6%
Ret/ On Assets - 3 Yr. Avg. 11.6%
Return On Total Capital 14.2%
Ret/ On T. Cap. - 3 Yr. Avg. 14.1%
Return On Equity 16.3%
Return On Equity - 3 Yr. Avg. 15.5%
Asset Turnover 0.9
Profitability Ratios
Gross Margin 83.8%
Gross Margin - 3 Yr. Avg. 83%
EBITDA Margin 30%
EBITDA Margin - 3 Yr. Avg. 30%
Operating Margin 19%
Oper. Margin - 3 Yr. Avg. 19.7%
Pre-Tax Margin 19.1%
Pre-Tax Margin - 3 Yr. Avg. 19.8%
Net Profit Margin 13.3%
Net Profit Margin - 3 Yr. Avg. 13.6%
Effective Tax Rate 30.7%
Eff/ Tax Rate - 3 Yr. Avg. 31.3%
Payout Ratio 0%

CERN stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CERN stock intrinsic value calculation we used $4796 million for the last fiscal year's total revenue generated by Cerner. The default revenue input number comes from 2016 income statement of Cerner. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our CERN stock valuation model: a) initial revenue growth rate of 8.4% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for CERN is calculated based on our internal credit rating of Cerner, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Cerner.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of CERN stock the variable cost ratio is equal to 64.9%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $789 million in the base year in the intrinsic value calculation for CERN stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 3.5% for Cerner.

Corporate tax rate of 27% is the nominal tax rate for Cerner. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the CERN stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for CERN are equal to 56.3%.

Life of production assets of 7 years is the average useful life of capital assets used in Cerner operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for CERN is equal to 9.3%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $3928 million for Cerner - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 327.863 million for Cerner is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Cerner at the current share price and the inputted number of shares is $22.4 billion.


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COMPANY NEWS

▶ 3 Stocks with Huge Competitive Advantages   [Jun-19-17 12:48PM  Motley Fool]
▶ House budgets $65M for VA to implement Cerner EHR with a catch   [Jun-15-17 04:56PM  American City Business Journals]
▶ VA selects Cerner to overhaul health record system   [Jun-07-17 01:03PM  American City Business Journals]
▶ Cerner looks to bolster stock price with $500M repurchase   [May-30-17 02:10PM  American City Business Journals]
▶ Cerner Announces Share Repurchase Program   [May-25-17 09:00AM  GlobeNewswire]
▶ Patterson remains absent from Cerner's annual shareholder meeting   [May-24-17 03:35PM  American City Business Journals]
▶ Better Buy: Veeva Systems Inc. vs. Cerner Corporation   [May-23-17 07:24AM  Motley Fool]
▶ Truman Med, Cerner team up to help patients manage chronic disease   [May-17-17 04:20PM  American City Business Journals]
▶ Cerner: Behavioral health is a 'growth area' for industry   [May-15-17 04:30PM  American City Business Journals]
▶ Cerner Named to Forbes 2017 Americas Best Employers List   [May-10-17 04:15PM  GlobeNewswire]
▶ Jeff Auxier Comments on Cerner   [May-09-17 04:03PM  GuruFocus.com]
▶ Which Companies Are Now Outperforming 95% Of All Stocks?   [May-03-17 12:20PM  Investor's Business Daily]
▶ Cerner Rises On Accelerating Growth; Earns IBD Rating Upgrade   [11:30AM  Investor's Business Daily]
▶ As regulations and cost pressures rise, Cerner's business grows   [03:35PM  American City Business Journals]
▶ Cerner beats Street 1Q forecasts   [Apr-27-17 04:26PM  Associated Press]
▶ Cerner Reports First Quarter 2017 Results   [04:01PM  GlobeNewswire]
▶ Cerner Has Further to Go on the Upside   [Apr-17-17 01:19PM  TheStreet.com]
▶ Which KC-area stocks had the best, worst March? Take a look   [Apr-03-17 04:50PM  at bizjournals.com]
▶ Which KC-area stocks had the best, worst March? Take a look   [04:50PM  American City Business Journals]
▶ Ex-Siemens Executive Donald Rucker To Head ONC   [Mar-31-17 05:52PM  at Forbes]
▶ Cerner tool saves lives, dollars by mitigating infection threat   [Mar-29-17 04:59PM  at bizjournals.com]
▶ Cerner tool saves lives, dollars by mitigating infection threat   [04:59PM  American City Business Journals]
▶ Cerner helps Missouri town join drug monitoring program   [Mar-27-17 04:07PM  at bizjournals.com]
▶ Cerner helps Missouri town join drug monitoring program   [04:07PM  American City Business Journals]
▶ Cerner may benefit from VA's health record overhaul   [Mar-23-17 01:50PM  at bizjournals.com]
▶ Cerner may benefit from VA's health record overhaul   [01:50PM  American City Business Journals]
▶ Cerner: Tech can help reduce uninsured pains from ACA reform   [Mar-14-17 05:51PM  at bizjournals.com]
▶ Cerner's new campus brings out the bells and whistles   [Mar-10-17 12:13PM  at bizjournals.com]
▶ Palmetto Health Expands Cerner Health IT System   [Mar-07-17 04:01PM  GlobeNewswire]
▶ Stocks Our Favorite Large-Cap Managers Have Been Buying   [Feb-20-17 06:00AM  at Morningstar]
▶ Cerner IT support: 'We've flipped the model upside-down'   [Feb-17-17 12:00PM  at bizjournals.com]
▶ DoD: New Cerner records system will empower patients   [Feb-16-17 03:20PM  at bizjournals.com]
▶ Behind the scenes: How Cerner protects its most valuable asset   [Feb-15-17 05:58PM  at bizjournals.com]
▶ 3 Best Stocks for Your 401(k)   [09:56AM  at Motley Fool]
▶ Is Cerner Still A Growth Company?   [Feb-12-17 11:29AM  Benzinga]
▶ The Biggest Loser: Cerner Slides 4.4%   [05:07PM  at Barrons.com]
▶ DoD quietly turns on Cerner's EHR pilot   [04:49PM  at bizjournals.com]
▶ [$$] Cerner Revenue Rises   [01:15PM  at The Wall Street Journal]
▶ Healthiest Employers: First Place Cerner Corp.   [06:15AM  at bizjournals.com]
▶ Better Buy: Veeva Systems Inc. vs. Cerner Corporation   [Feb-08-17 12:42PM  at Motley Fool]
Stock chart of CERN Financial statements of CERN Annual reports of CERN
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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