R1 RCM price target lowered to $16 from $19 at Deutsche Bank

Deutsche Bank analyst George Hill lowered the firm’s price target on R1 RCM to $16 from $19 and keeps a Buy rating on the shares after the company announced a deal to acquire Acclara as well as a 10-year outsourced deal with Providence as its revenue cycle management partner. The firm views the deal a “good win” for R1 RCM, saying the company announced a very large deal with one of the largest health systems in the U.S.. While the deal structure “appears a little less than arm’s length,” a large portion of Acclara’s business is not with Providence, representing either new customer wins or footprint expansion inside of other R1 customers, the analyst tells investors in a research note.