Earnings Preview: Wellpoint

Wellpoint (WLP) is expected to report Q3 earnings before market open Wednesday Oct. 22, with a conference call scheduled for 8:30 am ET.

Guidance

Analysts are expecting a profit of $1.50 on revenue of $15.52B. The consensus range for EPS is $1.43 to $1.65 with a revenue range $15.21B to $15.85B, according to First Call. Wellpoint reported Q2 EPS $1.47 vs. consensus of $1.36 and reported Q2 revenue $15.67B vs. consensus of $15.61B. On September 11 the company reaffirmed FY08 EPS guidance of $5.42-$5.57 vs. consensus of $5.47.

Analyst Views

Positives for this quarter include expansion of the account base and an increase in Medicaid enrollments. Negative factors for this quarters results include rising unemployment rates which can reduce member enrollment and intensified price competition.

On August 21, Banc of America initiated Wellpoint with a Buy and a target of $60. Banc of America expects shares to expand from near trough valuations. On October 3, Bernstein initiated Wellpoint with a Market Perform rating and a target of $54.