Bear Stearns Cuts NDCHealth Outlook

Analyst Raymond Falci says fourth-quarter results were significantly worse than expected

Bear Stearns cut its estimates on NDCHealth (NDC ).

Analyst Raymond Falci says fourth-quarter results were significantly worse than expected. The 7 cents operating earnings per share missed his 32 cents forecast. He notes softness in most business segments. Falci says first-quarter earnings per share guidance of breakeven to 5 cents earnings per share suggests margins and revenue growth won't snap back quickly. He notes the company didn't give fiscal guidance.

Also, Falci notes the lack of a consistent operating strategy, as NDCHealth announced numerous structural and operational changes -- a relatively consistent theme for NDC. He cut the 29 cents first-quarter earnings per share estimate to 7 cents, and cut the $1.27 fiscal 2005 (May) to 66 cents. He sees 99 cents fiscal 2006 earnings per share, and keeps his underperform rating.

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