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Wednesday, June 22, 2011
Healthstream ( Nasdaq - HSTM ) -- Outlook Positive
Healthstream (HSTM $11.15) is on track to produce excellent on target Q2 results. The share price fell yesterday in response to a downgrade by a Wall Street research firm. The fundamentals at the company remain intact. The change in opinion reflected a concern about the stock's high P/E ratio. Healthstream is continuing to gain market share in its core learning business. The company also is starting to broaden its horizon in that segment, diversifying beyond the acute care hospital segment. The research business is continuing to gain momentum, moreover. And while the high potential simulation partnership with Laerdal Medical still is in an early stage of development, that effort is on schedule. Major acceleration is likely over the next several years. That revenue contribution will be accretive to Healthstream's existing business, moreover, so overall results should benefit.