MDRX Stock Report

2-Year Price History

Ockham’s Rating

MDRX Revenue

As we have often noted, in our valuation methodology, "Cash is King." Well, it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company’s stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, MDRX the high and low end of the Price to Sales per share ratios are 6.07x and 2.10x respectively.

Notice that MDRX’s current Price to Sales per share ratio is 2.31x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $15.65, MDRX is 44% below where we would expect to see it. This will beneficially factor into our final analysis of MDRX as it is not often that this stock sinks to these levels.

MDRX Cash Earnings

As the old saying goes, "Cash is King!" However, we prefer to capture a few other items within our analysis to identify "cash earnings". Nevertheless, an analysis of Cash Earnings is absolutely pivotal to assessing a company’s value, and currently MDRX is significantly above their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for MDRX, the current level of Cash Earnings compared to its historical levels helps identify where MDRX is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 55.48 and a historical low Cash Earnings per share ratio of 20.53, an investor can relate where value becomes optimal.

Just recall that when a stock’s price, as in the cases of MDRX, is significantly elevated to the level of Cash Earnings being generated, the market has already priced in much of that value. For example, the historical average for MDRX’s Price to Cash Earnings ratio is 42% below the current ratio of 53.97. That is not an insignificant amount, and diminishes our overall outlook on MDRX. However, you need to review several areas of a company’s potential, and as management would point out, one metric is not the end-all-be-all of any analysis.

MDRX Dividends

While it is not necessary to pay an attractive dividend or a dividend at all, to receive a positive rating from Ockham, we view dividends as an additionally helpful measure in determining the future potential of any company. As of the time of this report, our data provider does not have historical data for MDRX. Therefore, we are not utilizing the dividends portion in our study. So, we do not know whether MDRX currently pays a dividend at present or not, we have an "expected dividend" payment listed in key fundamentals but cannot varify it.