With Medicaid And ACA Squared Away, Anthem Needs To Work On Medicare
Stephen Simpson, CFA
Stephen Simpson, CFA
Wed, Aug. 3, 10:08 AM
- Anthem (ANTM +0.8%) has asked a judge to decide on its deal for Cigna (CI +0.8%) by the end of the year and to split its case off from the government's challenge of a second merger of insurance companies.
- The DOJ filed lawsuits on July 21 asking a federal court to stop its takeover as well as Aetna's planned acquisition of Humana.
- How are they different? Anthem is arguing that while all four companies are health insurers, its deal is concentrated on commercial health insurance while the other merger is focused on Medicare Advantage.
Wed, Jul. 27, 8:44 AM
- Anthem (NYSE:ANTM) Q2 results ($M): Total Revenues: 21,456.2 (+7.2%); Premiums: 19,948.0 (+7.7%); Commercial & Specialty: 9,898.3 (+5.7%); Government: 11,371.1 (+9.5%).
- Net Income: 780.6 (-9.1%); Non-GAAP Net Income: 893.4 (+5.0%); EPS: 2.91 (-7.0%); Non-GAAP EPS: 3.33 (+7.4%); CF Ops (6 mo.): 1,966.3 (-30.4%).
- Health Benefits Ratio: 84.2% (+2.6%).
- 2016 Guidance: Revenues: $82.5B - 83.5B; EPS: >$9.34; Non-GAAP EPS: >$10.80.
Wed, Jul. 27, 6:03 AM
Tue, Jul. 26, 5:30 PM
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Thu, Jul. 21, 10:38 AM
- It's official. The U.S. Department of Justice (DOJ) has filed an antitrust suit in U.S. District Court in Washington, DC attempting to block the Anthem (ANTM +1.8%) and Cigna (CI +0.8%) merger and the Aetna (AET +0.9%) and Humana (HUM -0.4%) merger. In the complaint, the DOJ said the deals would be anti-competitive and would not be in the best interests of consumers.
- Unsurprisingly, the four companies take the opposite view.
Tue, Jul. 19, 10:37 AM
- According to Bloomberg, the U.S. is preparing litigation to block the Anthem (ANTM -2.2%)/Cigna (CI -2%) and Aetna (AET -3.5%)/Humana (HUM -4.2%) mergers over antitrust concerns.
- Previously: Humana, Aetna slide on chatter over Justice Dept. meeting (July 7)
- Previously: Anthem-Cigna deal in jeopardy? (June 30)
- Update: The Department of Justice filed an antitrust lawsuit on July 21 opposing both mergers.
Fri, Jul. 15, 10:10 AM
- Wells Fargo ticks off 20 S&P 500 stocks with the most upside potential vs. consensus, and the 20 with the most downside risk vs. consensus.
- The list is compiled by comparing the midpoint of Wells Fargo Securities valuation ranges to consensus fair value estimates, volatility adjusting the percentage difference, and ranking the resulting score.
- Upside: AEE, BEN, CCL, DVA, EIX, ES, EXC, FTR, HUM, INTC, JNJ, LNT, PEG, PNW, SCG, T, WEC, WU, XEL, XOM.
- Downside: ANTM, C, CI, COF, EQT, FOXA, FSLR, GS, KIM, LH, MON, MSI, MYL, NVDA, NWSA, SLG, TIF, TSO, UA, WLTW.
Thu, Jun. 30, 3:50 AM
- The Justice Department has told Anthem (NYSE:ANTM) its planned takeover of Cigna (NYSE:CI) threatens competition and probably can't be fixed by selling parts of their businesses, Bloomberg reports.
- The companies recently met with Bill Baer, the department's No. 3 official, in a bid to get the $48B deal approved. A decision on the combination is expected by mid-July.
Tue, Jun. 28, 8:38 AM
- Anthem (NYSE:ANTM) appears ready to walk away from its proposed $48B acquisition of healthcare insurance rival Cigna (NYSE:CI) because of regulatory headaches, NY Post reports.
- ANTM CFO John Gallina told a group of analysts last week that the company was working on “remediation plans” that include buying assets from Aetna (NYSE:AET), according to the report; it is assumed that ANTM would not be considering buying assets if it intended to move forward with plans to buy CI.
- The deal has a $1.85B breakup fee, but the companies reportedly have begun talks about renegotiating the amount.
Mon, Jun. 20, 5:32 AM
- U.S. antitrust regulators are concerned about Anthem's (NYSE:ANTM) proposed acquisition of Cigna (NYSE:CI) and aren't sure the health insurers can offer concessions that would fully preserve competition in the industry, WSJ reports.
- Company representatives met June 10 in Washington with Justice Department staffers and representatives of more than a dozen state attorneys general and have more meetings scheduled this week with top DOJ officials.
Thu, Jun. 16, 5:38 PM
- California's insurance commissioner is urging the U.S. Department of Justice to block Anthem's (NYSE:ANTM) takeover of Cigna (NYSE:CI), saying he is concerned it will raise premiums in the state.
- ANTM and CI would control 61% of California's administrative services market alone, the commissioner says.
- ANTM says it is "confident that the highly complementary nature and limited overlap of our organizations that will benefit the complex and competitive health insurance markets will be reviewed on the facts by the DoJ and appropriate state authorities."
Thu, May 26, 5:43 AM
- Stung by losses in Obamacare's first years, big health plans are looking for premium boosts of 20% or more in states like New York, Pennsylvania, and Georgia, and by more than 10% in places like Florida and Maryland.
- Among those published so far, only in Vermont do insurers' requests not hit the 10% level. Proposals, of course, need to be approved by state regulators.
- Also at issue - 2017 marks the year when some programs designed to cushion insurers' losses come to an end.
- While some state insurance commissioners are talking a tough game in regard to approving the requests, others say they are unable to deny the increases where an insurer has shown need, and they are required by law to ensure plans have enough funds to pay out claims.
- Among those looking for higher rates are Humana (NYSE:HUM) and Anthem (NYSE:ANTM).
Tue, May 24, 5:00 PM
- Gilead Sciences (NASDAQ:GILD) appoints former EVP of Commercial Operations Kevin Young as Chief Operating Officer and Martin Silverstein, M.D., as EVP, Strategy. Mr. Young has been a senior advisor to the company since 2014. Dr. Silverstein was most recently with Anthem (NYSE:ANTM) where he was EVP and Chief Strategy Officer.
- Paul Carter, EVP, Commercial Operations will depart.
Sun, May 22, 9:50 AM
- Quarrels have broken out behind the scenes of Anthem's (NYSE:ANTM) $48B proposed acquisition of Cigna (NYSE:CI) as the health insurers seek regulatory approval for their landmark deal, according to The Wall Street Journal.
- People on both sides say the squabbles could delay or derail antitrust approvals, which are typically harder to obtain if both parties aren't in sync.
- If completed, the deal would create the largest U.S. health insurer by members, with more than 54M, and $117B in annual revenue.
- Previously: Cigna warns Anthem deal may not close this year (May. 08 2016)
Tue, May 10, 1:50 PM
- Growth stocks have outperformed value stocks each year since 2007, but value investors are often rewarded after such periods. C.T. Fitzpatrick, the CIO of Vulcan Value Partners and the manager of Vulcan Value Partners Fund (MUTF:VVPLX), who has beaten the S&P 500 and its peers every year for the past five years gave his 4 value picks in an interview with Barron's.
- Oracle (NYSE:ORCL) is his top pick. Oracle and SAP (NYSE:SAP), both are leaders in the big enterprise market, but Oracle is in a better position with its applications plus database products along with being ahead in converting its customers to the cloud.
- National Oilwell Varco (NYSE:NOV) is a value pick since it generated tremendous free cash flow despite a poor quarter.
- Anthem (NYSE:ANTM) is a new addition since its business model is well-suited for the Affordable Care Act. Fitzpatrick believes that the company's stock price doesn't reflect the fundamentals.
- United Technologies (NYSE:UTX) gets interest as it has generated high free cash flow despite its bottom line being hurt by the strong dollar. Their accretion of cash is helping return on capital thereby making it a value pick.
- His top 10 holdings as of Dec. 31 are Oracle, Parker Hannifin (NYSE:PH), National Oilwell Varco, Franklin Resources (NYSE:BEN), Discovery Communication (NASDAQ:DISCK), Swiss RE AG, MasterCard (NYSE:MA), Cisco Systems (NASDAQ:CSCO), Anthem and Boeing (NYSE:BA).
Sun, May 8, 8:37 AM
- Due to the complexity of the regulatory process, Cigna (NYSE:CI) is cautioning that its acquisition by health-insurance rival Anthem (NYSE:ANTM) may not be approved this year, but could rather close in 2017.
- The two agreed to a $48B cash-and-stock merger deal last July. The transaction, along with Aetna's pending acquisition of Humana, would reduce the number of big U.S. health insurers from five to three.