The economic data was impressive this past week and the markets reacted very well. Despite the Apple fallout (with a reported record breaking quarter), the markets are grinding higher. Lately the trend is a positive reaction to good news, and a muted response to any bad news. This is great for the bulls, bad for bears, but will eventually fade as it always does. The market can stay irrational longer than anyone can stay solvent, so it may be awhile before a pullback occurs for many investors looking to short the market. There are many folks on Wall Street arguing both the bull and the bear case as the markets are hovering around multi-year highs.
One certainty in this economic environment is that every company is continuing to look for ways to be more efficient and lower costs. This is obviously a basic principle of business that every owner must focus on in order to improve profits. Costs can be cut in many ways, and the trend in most sectors is finding technology solutions to improve the overall performance of the business. From processes to basic operations, technology has revamped the way many businesses operate, which benefits the bottom line. One company that has continued to grow, providing solutions for its customers in the healthcare industry, is Buffalo, NY-based Computer Task Group.
Computer Task Group (NASDAQ: CTGX) is a staffing and information technology solutions company with most of its operations in North America and Europe. CTG is a provider of business consulting solutions and Information Technology to the healthcare industry, providing an array of electronic services for medical records. The company provides software that supports lower cost healthcare, allowing medical institutions to save costs. Computer Task also provides IT staffing for both small and large corporations.
The company was ranked 10th on the Modern Healthcare’s annual ranking of the biggest healthcare management consulting firms, climbing by 3 spots for last year’s ranking. The list was published this past September 3rd, which ranked eighty firms in the sector by 2011 revenue generated from providers. The company recently announced that it has extended a stock repurchase plan under Rule 10b5-1 of the Securities and Exchange Commission to facilitate the repurchase of its common stock. The Company had approximately 535,000 shares available for repurchase as of Dec. 31, 2012, under its outstanding repurchase authorizations. The stock currently trades at $19.09, very close to its 52-week closing low of $19.12. The stock recently made an intra-day high of $19.30 on January 3rd of this year before pulling back to around $19 a share.
Over the last 26 years, CTG Health Solutions has provided healthcare IT, and operational and strategic consulting support to more than 600 healthcare organizations. The firm has a market capitalization of 255.58 million, and 3700 employees. Over the last 52 weeks the shares have returned 47.6%, as investor optimism about the firm’s prospects has grown. CTGX reported another great quarter back in October of 2011, after announcing another solid report despite it being seasonally one of the weakest times of the year. The company is set to report its earnings on February 21st. BGB recently reiterated its buy rating, raising its price target from $17 to $21. CTGX continues to impress analysts, gaining market share and increasing revenue. By helping healthcare companies lower their costs the company is providing a very desirable service. Any pullback in the stock should probably be purchased as the stock is expected to outperform in 2013.