Investing isn’t always about “buy low, sell high.” Sometimes it’s about “buy high, sell higher.” But how do you know when a stock’s run too much? That’s the question Cramer is trying to answer with Allscripts-Misys Healthcare Solutions. As much as he likes the it, MDRX is up 97% over the past 12 months.
Is the run over? Cramer doesn’t think so, and here’s why: MDRX is a major beneficiary of the stimulus bill passed year, and much of the spending related to the company’s business – health-care technology that makes doctor and hospital filing, claims and prescribing systems more efficient – hasn’t yet kicked in. Doctors won’t start receiving checks from the federal government until 2011.
So if Allscripts was able to deliver such a strong quarter on Wednesday without that stimulus spending, Cramer said, imagine how it might perform once the money starts flowing.
Oddly, though, despite this stock’s strong performance, MDRX is still 7% from its 52-week high. Cramer had to wonder if the momentum was gone. To find out, he asked CEO Glen Tullman to appear on the show. Watch the video for the full interview.
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