On Monday (NASDAQ:MNDY), RBC (TSX:RY) Capital Markets adjusted its outlook on TruBridge Inc (NASDAQ:TBRG), increasing the price target to $16.00, up from the previous $14.00, while reaffirming the Outperform rating for the company's stock. This revision follows TruBridge's third-quarter financial results, which surpassed consensus estimates for revenue and EBITDA by 1.1% and 9.7%, respectively.
The company's recent performance has prompted management to revise its full-year guidance upwards by 0.3% for revenue and 4.2% for EBITDA, exceeding the quarter's outperformance. This update is seen as a reflection of TruBridge's broad-based strength, including a double-digit percentage increase in revenue cycle management bookings and an EHR performance that exceeded expectations.
TruBridge has also made significant strides in improving its profit margins. Efforts such as offshoring and pre-existing internal actions have contributed to this progress. The company's steps toward strengthening its balance sheet, which include reducing leverage and lowering days sales outstanding (DSOs), have been noted as positive indicators for setting a more robust foundation for growth in 2025.
The price target increase to $16 is based on the same approximately 7x multiple of the firm's revised 2025 EBITDA projections. RBC Capital Markets' decision to maintain the Outperform rating is supported by the company's recent achievements and ongoing initiatives that are expected to reinforce its growth trajectory.
In other recent news, TruBridge, Inc. has made significant amendments to its corporate bylaws, which include changes to proxy solicitation rules and definitions related to stockholder engagement. The company has also clarified officer duties, reinforcing its commitment to maintaining a clear and effective governance structure.
Deutsche Bank (ETR:DBKGn) has lowered its price target from $12 to $11, with TruBridge's revised total revenue forecast now standing at a range of $330 million to $340 million. Despite a year-over-year decline of 3.1% in the second quarter, the company reaffirmed its full-year adjusted EBITDA to be within the range of $45 million to $50 million.
InvestingPro Insights
TruBridge Inc's recent performance and RBC Capital Markets' optimistic outlook are further supported by real-time data and insights from InvestingPro. The company's market capitalization stands at $194.15 million, reflecting its current market valuation.
InvestingPro Tips highlight that TruBridge's net income is expected to grow this year, aligning with the company's improved guidance and RBC's positive stance. Additionally, the stock is trading near its 52-week high, with a significant 54.5% price increase over the last six months, indicating strong market confidence in the company's direction.
However, it's worth noting that TruBridge is currently not profitable over the last twelve months, with a negative P/E ratio of -11.09. This underscores the importance of the company's efforts to improve profit margins, as mentioned in the article.
For investors seeking a more comprehensive analysis, InvestingPro offers 5 additional tips that could provide further insights into TruBridge's financial health and market position.
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