Oracle
ORCL
recently received all the required antitrust approvals, including European Commission clearance, for its proposed
Cerner
CERN
acquisition.
Cerner focuses on providing digital information systems used in hospitals and healthcare systems, enabling medical professionals to deliver improved healthcare to communities and individuals.
The planned $28.3 billion acquisition, announced last year by Oracle and Cerner, is now expected to close on Jun 6.
The acquisition will help Oracle expand its back-office technology for hospitals and healthcare service providers. Cerner’s acquisition is also anticipated to be a huge growth accelerator for Oracle in years to come as Oracle expands Cerner’s business all over the world.
The merger will be substantially accretive to Oracle’s earnings on a non-GAAP basis in fiscal 2023 and contribute to its earnings thereafter.
Oracle Corporation Price and Consensus
Oracle Corporation price-consensus-chart
|
Oracle Corporation Quote
Cerner Acquisition Positions Oracle in the Healthcare Tech Space
Healthcare is the biggest and most important vertical globally, especially as the pandemic has made us realize in the last two years. The use of cloud computing in healthcare has also increased since then.
During the pandemic, the entire healthcare system had to depend on the application of cloud computing. There is now an increased understanding of the potential of cloud technologies, which provide data storage and computing resources managed by external service providers to help improve the safety, quality and efficiency of healthcare.
Per a
Mordor Intelligence
report, the healthcare cloud computing market is expected to reach $71.7 billion by 2027 at a CAGR of 14.12%.
With these trends in the backdrop, it is no surprise that Oracle entered the healthcare market with its plans to acquire Cerner.
Moreover, the Cerner systems were already running on Oracle Database. Thus, with the completion of the merger, migrating and integrating Oracle cloud offerings with Cerner’s platform can be accomplished seamlessly without any downtime.
Oracle is expecting to benefit from increased demand for telemedicine among consumers. With the deal in place, Oracle will complete Cerner’s transition to the cloud and equip the electronic health record (EHR) with increased virtual care capabilities. Oracle will also be adding its hands-free digital voice assistant to Cerner’s interface.
However, stiff competition awaits this Zacks Rank #4 (Sell) company in the EHR space. Firms with a greater presence in the cloud-based services market, such as
Alphabet
’s
GOOGL
Google Cloud and
Microsoft
MSFT
, have also been investing in the EHR industry.
You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
Alphabet-owned Google Cloud unveiled a preview of the Healthcare Data Engine and end-to-end solution for healthcare and life sciences organizations. The healthcare solution will help in harmonizing healthcare data from multiple sources, including medical records, claims, clinical trials, and research data.
Moreover, Microsoft recently completed the acquisition of Nuance Communications. Headquartered in Burlington, MA, Nuance Communication specializes in offering innovative conversational Artificial Intelligence (AI) tools to boost business productivity
The acquisition is expected to bolster Microsoft’s position in the lucrative healthcare domain. Previously the software giant had
noted
that the Nuance acquisition is likely to increase the company’s total addressable market in the healthcare space to $500 billion.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report