Does Computer Programs and Systems Inc. (CPSI) offer a good opportunity for investors?

Computer Programs and Systems Inc. (NASDAQ: CPSI) stock fell -1.26% on Friday to $15.73 against a previous-day closing price of $15.93. With 3.48 million shares changed hands, the volume of the stock remained heavier than its average volume of 0.14 million shares. During the session, the Health Information Services company that operates in wider Healthcare sector, reached to the highest price of $15.96 whereas the lowest price it dropped to was $15.50. The 52-week range on CPSI shows that it touched its highest point at $32.90 and its lowest point at $14.09 during that stretch. It currently has a 1-year price target of $27.25. Beta for the stock currently stands at 0.81.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of CPSI was up-trending over the past week, with a rise of 7.30%, but this was down by -14.60% over a month. Three-month performance dropped to -37.05% while six-month performance fell -45.31%. The stock lost -46.50% in the past year, while it has lost -42.21% so far this year. A look at the trailing 12-month EPS for CPSI yields 0.34 with Next year EPS estimates of 2.26. For the next quarter, that number is 0.42. This implies an EPS growth rate of -13.90% for this year and 14.70% for next year. EPS is expected to decline by -0.03% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 22.60%.

Float and Shares Shorts:

At present, 14.20 million CPSI shares are outstanding with a float of 13.91 million shares on hand for trading. On Aug 30, 2023, short shares totaled 0.41 million, which was 2.81% higher than short shares on Jul 30, 2023. In addition to Mr. Christopher L. Fowler as the firm’s CEO, Pres & Director, Mr. Matt J. Chambless serves as its CFO, Sec. & Treasurer.

Institutional Ownership:

Through their ownership of 92.14% of CPSI’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 44.68% of CPSI, in contrast to 44.61% held by mutual funds. Shares owned by individuals account for 28.83%. As the largest shareholder in CPSI with 14.69% of the stake, BlackRock Fund Advisors holds 2,137,517 shares worth 2,137,517. A second-largest stockholder of CPSI, River Road Asset Management LLC, holds 1,178,629 shares, controlling over 8.10% of the firm’s shares. The Vanguard Group, Inc. is the third largest shareholder in CPSI, holding 952,738 shares or 6.55% stake. With a 6.97% stake in CPSI, the iShares Core S&P Small Cap ETF is the largest stakeholder. A total of 1,013,570 shares are owned by the mutual fund manager. The AMG River Road Small Cap Value Fu, which owns about 3.18% of CPSI stock, is the second-largest Mutual Fund holder. It holds 463,147 shares valued at 7.54 million. Vanguard Total Stock Market ETF holds 2.80% of the stake in CPSI, owning 407,736 shares worth 6.63 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Jun 29, 2023, CPSI reported revenue of $82.73M and operating income of $4.59M. The EBITDA in the recently reported quarter was $11.05M and diluted EPS was $0.21.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CPSI since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With CPSI analysts setting a high price target of $33.00 and a low target of $24.00, the average target price over the next 12 months is $27.25. Based on these targets, CPSI could surge 109.79% to reach the target high and rise by 52.57% to reach the target low. Reaching the average price target will result in a growth of 73.24% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Dividends & Yield:

In terms of dividends, CPSI has a dividend of $0.45 is likely to be paid on average over the next five years. Dividend yield is another indicator that appeals to many investors, and CPSI currently yields $0.28. In the past year, CPSI’s dividend yield has been $0.28, but when looking at the stock over the past five years, its yield has been $1.61. Accordingly, CPSI has a current buyback yield of $4.46. This was $4.46 for the TTM.

Summary of Insider Activity:

Insiders traded CPSI stock several times over the past three months with 1 Buys and 1 Sells. In these transactions, 2,714 shares were bought while 1,507 shares were sold. The number of buy transactions has increased to 12 while that of sell transactions has risen to 28 over the past year. The total number of shares bought during that period was 81,686 while 21,175 shares were sold.

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