Update: HSTM missed Q4 and cut numbers for 2014. 2015 estimates are still way too high. The stock is down (8.5%), a sign that growth investors are getting fed up with HSTM cutting numbers.
Ask the cheerleading sell-side analysts who all congratulated management on a great Q4/2013:
- What were their original estimates for 2013 (Street started 2013 at 38c, HSTM earned 30c)
- What were their original 2014 numbers (Street started at 50c, Management guided 33-36c)
- How do they justify 2015 numbers? Rev growth with ICD headwind? Where is margin improvement coming from?
- Why place a 6X revenue on ICD revenues, which will decline?
Disclosure: I am short HSTM. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.