Leerink Upgrades Vocera Communications Following Proprietary Survey

Shares of Vocera Communications Inc (NYSE: VCRA) spiked higher by more than 7 percent Monday after analysts at Leerink upgraded the stock.

David Larsen, Leerink's Health Care Services analyst, upgraded Vocera to Outperform from Market Perform with an unchanged $14 price target following a proprietary survey which indicated "solid demand" for its products and services.

Larsen noted that he commissioned MEDACorp to oversee a survey of 37 hospital administrators to study trends in the Wireless Communication market. The study concluded that satisfaction scores amongst Vocera's clients were "high." In addition, the study concluded that a "large portion" of Vocera users expect to purchase additional badges over the next year as overall spending on communication and care coordination solutions is expected to rise through 2017.

"We believe that nurses value the hands-free nature of the badge," Larsen also concluded from the study. "We also believe that Vocera's investments into secure texting, patient engagement, communication, and integration into EMRs, are all making the full portfolio of products attractive to hospitals. Integrated Delivery Networks (IDNs) can use Vocera to improve HCAHP scores, which is becoming increasingly important as ACOs and patients begin to shop more aggressively for care."

Larsen continued that the study showed four "positive drivers" that are not fully appreciated by the investment community. The drivers include: 1) improving industry fundamentals where hospitals are purchasing more care coordination, 2) Vocera has beat the high-end of its revenue guidance in each of the past four quarters, 3) Vocera is shifting itself to a "care coordination platform," and 4) Vocera could eventually be acquired given its "high" product quality with a large client base.