The computing major Hewlett-Packard Co. (HPQ) recently introduced a new program to facilitate different healthcare setups. The program will help doctors and different hospitals access different formats for storing the health records popularly known as electronic health records (EHR).
With the help of this new technology, named as HP EHReady, hospitals and their affiliated physicians can access the patient’s data constantly through an integrated EHR patient network. This in turn increases the efficiency, security and also the patient care facility of the concerned organization.
For quite some time the company had been exploring opportunities in the Electronic Health Records sector. Electronic Health Record helps doctors and hospitals to organize medical records of patients in a manner that makes tracking the clinical history of patients more convenient from anywhere in the world, without the hassle of storing hard copies.
The company will also provide flexible financing options to organizations for boosting immediate investments in EHR technology and provide services such as need assessment, system configuration, workflow process designing and providing training and support to medical practitioners and hospitals.
We think this is an ideal time to enter this business, as the federal government has passed a bill, granting around $19.0 billion in incentives to medical practitioners and hospitals for buying and using electronic record keeping software.
Besides, we believe this could be a lucrative business for companies like HP, as only a small portion of the American health care providers have adopted a full-fledged Electronic Health Record system, so there is substantial growth potential in this segment.
HP’s second quarter EPS exceeded the Zacks Consensus Estimate and revenues continued to grow on a year-over-year basis, showing substantial improvement.
Although we remain positive on the company’s performance going forward given the improving demand and premier position enjoyed in the PC segment, the printing business lags due to availability of cheaper substitutes.
Thus we maintain our long-term Neutral rating on the stock, with a short term Zacks #2 Rank (Buy).
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