Cerner operational initiatives, expanded buyback encouraging, says Baird

Baird analyst Matthew Gillmor said he is encouraged by the operational initiatives and expanded stock buyback program announced by Cerner, stating that shareholders have been advocating for changes similar to those the company will implement in its agreement with activist fund Starboard Value. While stating that skeptics will argue this is a one-time step up in EPS power and that a revenue mix shift will continue to drag on margins, Gillmor counters that Cerner has "ample capacity" to keep buying back stock even after completing the program announced this morning. He keeps an Outperform rating on Cerner and raised his price target on the stock to $71 from $67.
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