Aetna Looks Like A Continuing Winner Among Insurance Majors
May 13, 2015, 4:03 PM
- Humana (HUM +0.1%) spiked yesterday on the possibility that it may merge with Aetna (AET -0.3%) opined by Lerrink's Ana Gupte. Today, Sterne Agee's Brian Wright rains on the parade by saying a merger is doubtful due to Humana's premium valuation. He adds credence to his view by cutting his 2015 EPS outlook to $8.07 from $8.40 and 2016's to $9.17 from $9.71. He also cut his rating on HUM to Underperform from Neutral.
May 12, 2015, 3:57 PM
May 5, 2015, 1:09 PM
- It took a while, but the first major health insurer announces its intention to stop paying for the routine use of the laparoscopic power morcellator. Aetna (AET -2%) says it will cease coverage beginning May 15. Doctors will have to be pre-approved thereafter based on exceptions for pre-menopausal women who want to preserve fertility and have no other treatment options and women for whom other procedures could lead to severe complications or be life-threatening.
- A power morcellator has spinning blades that are used to cut uterine fibroids or the uterus into pieces so they can be removed through small incisions in the abdomen, characteristic of minimally invasive surgery. Cancer cells can hide in fibroid tissue, however, which can be spread by the spinning blades, increasing the women's risk of cancer.
- A year ago, Johnson & Johnson (JNJ -0.9%) stopped selling the product in light the risk. At about the same time, the FDA issued an advisory to clinicians to discourage the use of the device. In July, J&J started withdrawing the product from the market, including the return of already-purchased devices. In November, the FDA formally stated that the devices should not be used on the vast majority of women.
- Other insurers will most certainly follow Aetna's lead.
- Previously: Johnson & Johnson withdraws fibroid treatment device from market (July 30, 2014)
- Previously: J&J halts the sale of Ethicon device (April 30, 2014)
Apr. 28, 2015, 7:19 AM
- Aetna (NYSE:AET) Q1 results ($M): Total Revenues: 15,094.1 (+7.9%); Health Care Premiums: 12,940.1 (+8.6%); Health Care Costs: 10.240.5 (+6.9%); Total Benefits and Expenses: 13,727.5 (+6.9%); Operating Earnings: 844.3 (+16.9%); Net Income: 777.5 (+16.8%); EPS: 2.20 (+20.9%).
- Medical Benefit Ratios: Commercial: 77.4% (+0.3%); Government: 81.3% (-4.0%); Health Care: 79.1% (-1.6%).
- Membership (000s): Medical: Commercial: 19,859 (+0.2%); Medicare Advantage: 1,228 (+7.7%); Medicare Supplement: 488 (+5.6%); Medicaid: 2,095 (-1.4%); Dental: 15,555 (+0.4%); Pharmacy Benefit Management: Commercial: 10,789 (+0.5%); Total PBM: 15,425 (+0.7%).
- 2015 Guidance: Operating Earnings Per Share: $7.20 - 7.40 from $7.00.
Apr. 28, 2015, 6:02 AM
- Aetna (NYSE:AET): Q1 EPS of $2.39 beats by $0.44.
- Revenue of $15.09B (+8.0% Y/Y) misses by $370M.
Apr. 27, 2015, 5:30 PM
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Apr. 7, 2015, 7:14 AM
- The government surprisingly intends to increase Medicare Advantage payments by about 1.25% in 2016, reversing a proposal to make a cut of 0.9%.
- The move should benefit insurers such as UnitedHealth (NYSE:UNH) and Humana (NYSE:HUM).
- The change is mainly connected to tweaks in estimates of how fast Medicare spending has been rising rather than to changes in policy.
- Other health insurers include: AET, HNT, MO
- ETFs: XLV, XHE, VHT, FXH, IHF, IHI, IYH, PTH, RYH, PSCH, RXL, RXD, XHS
Mar. 19, 2015, 10:34 AM
- According to Bloomberg, major providers of Medicare coverage like Humana (HUM +0.9%), WellCare (WCG +0.6%) and Centene (CNC +1.4%) are high on the acquisition radar of large insurers who have relatively modest exposure to the rapidly growing Obamacare-stoked space. Likely suitors would be Aetna (AET +1.3%) and Anthem (ANTM +0.3%).
- There hasn't been much M&A activity among health insurers due to the uncertainties surrounding the implementation of the Patient Protection and Affordable Care Act. Now that its implications are better understood, the number of deals should perk up.
- No bargains are out there, though. S&P's index of health insurers galloped 57% last year. The current valuations for Humana, WellCare and Centene are $26.9B, $4.1B and $8.3B, respectively, all at record levels since at least 2007.
- Anthem CFO Wayne DeVeydt says his firm will continue to make smaller deals although a larger purchase is not out of the question. Other firms declined to comment.
- Leerink Partners analyst Ana Gupte says a likely scenario is consolidation among the five largest health insurers: UnitedHealth Group (UNH +0.8%), Anthem, Aetna, Cigna (CI +0.6%) and Humana.
- Aging baby boomers, born between 1946 and 1964, are driving the increase in Medicare enrollment. Membership is expected to rise to 68.4M in 2023, up more than 25% from this year's 54.4M. Medicaid is projected to add 9.3M people over the same time frame.
Feb. 27, 2015, 3:24 PM
- Aetna (NYSE:AET) declares $0.25/share quarterly dividend, in line with previous.
- Forward yield 1.0%
- Payable April 24; for shareholders of record April 9; ex-div April 7.
Feb. 23, 2015, 12:07 PM
- Among the additions to the index (which fuels the IBLN ETF) are EMC, Google (GOOG, GOOGL), Goodyear (NASDAQ:GT), Mohawk Industries (NYSE:MHK), PVH, Time Warner (NYSE:TWX), and Yahoo (NASDAQ:YHOO). There are three health care additions as well: Allergan (NYSE:AGN), Amgen (NASDAQ:AMGN), and HCA. The lone energy name added is Consol Energy (NYSE:CNX).
- Exiting the index are energy names Halliburton (NYSE:HAL) and National-Oilwell Varco (NYSE:NOV), along with healthcare companies AbbVie (NYSE:ABBV), Aetna (NYSE:AET), Humana (NYSE:HUM), and Tenet Healthcare (NYSE:THC). Citigroup (NYSE:C), CBS, Crown Castle (NYSE:CCI), and Michael Kors (NYSE:KORS) round out those subtracted.
- IBLN tracks the highest-conviction S&P 500 picks by hot-handed billionaires who built their fortunes through hedge funds and investing. The list of billionaires tracked is updated each October, and the equity components are rebalanced each quarter after sifting through regulatory filings.
- IBillionaire Index Rebalance
Feb. 3, 2015, 8:56 AM
- Aetna (AET +0.4%) Q4 results: Revenues: $14,771.2M (+12.0%); Operating Expenses: $3,071.4M (+22.5%); Net Income: $232M (-37.1%); EPS: $0.65 (-35.0%).
- FY2014 results: Revenues: $58,003.2M (+22.6%); Operating Expenses: $10,837.7M (+25.4%); Net Income: $2,040.8M (+6.6%); EPS: $5.68 (+6.6%).
- Medical Membership: 23,548 (+6.1%), Commercial: 19,822 (+5.3%), Medicare Advantage: 1,140 (+17.8%), Medicare Supplement: 462 (+19.7%), Medicaid: 2,124 (+5.4%).
- Medical Benefit Ratios (MBRs): Commercial: 82% (+0.4%), Government: 84.4% (-3.0%); Healthcare: 83% (-1.1%).
- MBRs FY2014 results: Commercial: 80.2% (+0.1%); Government: 84.9% (-3.0%); Healthcare: 82.2% (-0.8%).
- 2015 Guidance: operating earnings per share of at least $7.00.
Feb. 3, 2015, 6:03 AM
- Aetna (NYSE:AET): Q4 EPS of $1.22 in-line.
- Revenue of $14.77B (+12.5% Y/Y) beats by $170M.
Feb. 2, 2015, 5:30 PM
Jan. 28, 2015, 4:03 PM
- A study done by researchers from New York and Columbia Universities found that premiums were slightly higher for policies offered on state-run health exchanges where there were higher numbers of competitors, precisely the opposite effect that supposedly characterizes more intense competition.
- Overall, average monthly premiums were $5.71 higher per additional insurer (p<0.001). In addition, average monthly premiums were $3.18 higher per additional insurer for identical plans offered.
- The analysis focused on the prices for each unique insurance plan offered on the exchanges in each geographic rating area. The number of rating areas varied widely in the 34 states examined, from only one in NJ, NH and DE to 67 in FL.
- The authors acknowledge that the higher premiums may be due to higher cost areas (urban vs rural) where more insurers are located rather than a lack of competition.
- Related tickers: (NYSE:AFL) (NYSE:AIG) (NYSE:AET) (NYSE:CI) (NYSE:CNC) (NYSE:UNH) (NYSE:ANTM) (NYSE:MOH) (NYSE:HNT) (NYSE:HUM) (NYSE:WCG) (NASDAQ:MGLN)
Dec. 10, 2014, 5:48 PM
- Aetna (NYSE:AET) -1% AH after issuing a weaker than expected earnings forecast for next year, saying it expects to make at least $6.90/share on revenue of at least $62B vs. analyst consensus estimates of $7.17/share on $61.7B in revenue.
- AET reaffirms guidance for FY 2014 adjusted EPS of $6.60-$6.70 vs $6.65 analyst consensus, on expected operating revenues of $57B-$58B.
Nov. 21, 2014, 3:07 PM
Aetna, Inc. engages in the provision of traditional, voluntary, and consumer-directed health insurance products and related services. It operates through the following segments: Health Care, Group Insurance, and Large Case Pensions. The Health Care segment consists of medical, pharmacy benefit... More
Industry: Health Care Plans
Country: United States
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