Baird Equity Research has maintains Outperform rating for Cerner Corporation (NASDAQ:CERN) in its updated note ahead of the company’s 4Q2015 earnings release. Cerner reports results for the last quarter of 2015 after the markets close today, Feb. 16. Baird predicts that Cerner will report mostly in-line 4Q, but 1Q guidance is likely to disappoint.

4Q2015 estimates

For 4Q2015, Baird expects Cerner Corporation (NASDAQ:CERN) to post revenue of $1.163 billion. Wall Street on the average is anticipating revenue of $1.17 billion. Cerner on its part guided for revenue in the range of $1.15 to $1.2 billion for the quarter. At the midpoint, Cerner’s revenue guidance implies 1% organic topline growth, which Baird believes is conservative.

Coming to the bottom-line, Baird is looking for EPS of $0.56, which compares with the Street estimate of $0.57 and Cerner’s own guidance in the band of $0.56 to $0.58.

Baird sees bookings in 4Q rising $1.507 billion. The Street sees bookings of $1.495 billion and Cerner guided for bookings in the range of $1.45 to $1.55 billion.

3Q2015 recap

In the last quarter, Cerner Corporation (NASDAQ:CERN)’s revenues rose 34% YoY, but missed the Street estimate by 3.6%. Revenue increased 4.5% organically. Soft sales of third-party products and contract milestones took the spotlight away from the topline in 3Q2015. Nevertheless, bookings increased 44%, beating even the consensus estimate and EPS was in-line.

1Q guidance could be softer than anticipated

Consensus estimates call for 1Q2016 bookings, revenue and EPS of $1.346 billion, $1.18 billion and $0.54, respectively. According to Baird, the degree of 4Q beat will show if Cerner Corporation (NASDAQ:CERN) will meet Street’s seemingly lofty targets.

As much as Baird sees multiple growth catalysts for Cerner, the firm notes that upside potential in 1Q looks limited. Among other things, Baird expects Cerner to benefit from favorable macro trends and other company-specific advantages over the long-term.

For 2016, Cerner Corporation (NASDAQ:CERN) provided tentative revenue guidance of more than $5 billion and EPS in the range of $2.30 to $2.40.

Baird has a price target of $72 on Cerner.