Good Execution Continuing To Boost UnitedHealth
Stephen Simpson, CFA
Stephen Simpson, CFA
Fri, Apr. 15, 11:46 AM
- Celator Pharmaceuticals (CPXX +4.6%) initiated with Buy rating and $24 (63% upside) price target by Needham.
- Retrophin (RTRX -1.7%) initiated with Outperform rating and $25 (67%upside) price target by BMO Capital.
- Fate Therapeutics (FATE -3.2%) initiated with Outperform rating and $4 (85% upside) price target by BMO Capital.
- Tobira Therapeutics (TBRA +4.4%) initiated with Buy rating and $22 price target by H.C. Wainwright.
- Wright Medical Group (WMGI +2.4%) initiated with Buy rating and $23 (21% upside) price target by Bank of America.
- Cleveland Research rates UnitedHealth Group (UNH -0.9%) a Buy with a $155 (22% upside) price target; Anthem (ANTM -0.5%) a Buy with a $170 (20% upside) price target and Aetna (AET -0.4%) Neutral with a $120 (10% upside) price target.
- Glaukos (GKOS +0.3%) initiated with Hold rating by Stifel.
- Baxter International (BAX -0.3%) upgraded to Overweight from Neutral by Piper Jaffray. Price target raised to $58 (36% upside) from $39.
- Baird upgrades Exactech (EXAC +0.7%) to Outperform from Neutral and raises the price target to $26 (18% upside) from $21. Stryker (SYK -0.9%) downgraded to Neutral from Outperform and raises the price target to $116 (6% upside) from $111.
- Tenet Healthcare (THC -2.5%) upgraded to Positive from Neutral by Susquehanna.
- Clovis Oncology (CLVS -1.5%) downgraded to Neutral from Overweight by JP Morgan. Price target lowered to $15 (7% upside) from $42.
- AstraZeneca (AZN +0.3%) downgraded to Sell from Neutral by Goldman Sachs. Price target lowered to 3,700p (11% downside risk) from 4,400p.
- Intercept Pharmaceuticals (ICPT +0.2%) downgraded to Underweight from Equal Weight by Morgan Stanley. Price target lowered to $80 (48% downside risk) from $100.
Thu, Feb. 25, 11:55 AM
- In a regulatory filing, UnitedHealth Group (UNH) reports that it has issued a total of $2.5B in debt: $750M of 1.700% Notes due February 15, 2019; $750M of 2.125% Notes due March 15, 2021 and $1B of 3.100% Notes due March 15, 2026.
- The Notes, issued today, were sold pursuant to its February 22 Underwriting Agreement and Pricing Agreement with several major investment banks.
Thu, Feb. 18, 10:35 AM
- Behemoth pharmacy benefits manager Express Scripts (ESRX -0.7%) has apparently made scant progress in its contentious negotiations with its largest customer, Anthem (ANTM +1.1%), over drug discounts. In its earnings call yesterday, CEO George Paz said he "has no clue" where the $3B that Anthem says it is owed in additional prescription drug savings under their 10-year contract comes from.
- The risk that ESRX may lose its largest client when their contract ends after 2019 has weighed on its stock price. Shares are down over 20% this year. Even if they resolve their differences, though, Anthem may still bid adieu if its merger with Cigna (CI +0.4%) goes through (likely) and it decides to manage prescriptions internally, a move that UnitedHealth (UNH +0.7%) has already done.
- Anthem represents 14% on ESRX's revenue but much less of its profit. It processed almost 1.3B claims last year and will most certainly process over 1B claims annually beyond 2019 exclusive of Anthem.
- Previously: Anthem to acquire Cigna for $54.2B (July 24, 2015)
Wed, Feb. 10, 8:02 AM
Fri, Jan. 29, 5:47 PM
- The best-performing U.S. stock over the past 30 years is one that few have heard of: Balchem (NASDAQ:BCPC), a New York-based maker of flavorings, fumigating gases and nutritional additives for animal feed.
- Since the end of 1985, Balchem has gained an average of 26.2%/year - a total gain of 107,099% - vs.10.3% for the S&P 500.
- But with flattening profitability and shares at a lavish 27x earnings, Balchem looks expensive for now, WSJ's Jason Zweig writes.
- Over the past 30 years, 44 U.S. stocks generated cumulative total returns of 10,000% or more; the 10 behind Balchem are HD, AMGN, NKE, UNH, DHR, OTCPK:ATCD, KSU, JKHY, AAPL and MO.
Thu, Jan. 21, 11:22 AM
- With the aim of reducing drug development costs via more informed post-approval (Phase 4) studies, UnitedHealth Group's (UNH -0.7%) Optum unit and PAREXEL (PRXL -0.5%) form a strategic alliance. The partnership will leverage Optum's clinical data derived from electronic health records, claims data assets and analytics with PAREXEL's global site-based research expertise to offer hybrid studies that will accelerate the collection of clinical evidence supporting the effectiveness of medicines.
- The need to validate the effectiveness of drugs in the clinic continues to build due to ever-increasing costs and the growing body of evidence that shows many drugs, once in the market, fail to demonstrate the level of efficacy achieved in clinical trials.
- Financial terms of the alliance are undisclosed.
Tue, Jan. 19, 7:27 AM
- UnitedHealth Group (NYSE:UNH) Q4 results ($M): Total Revenues: 54,729 (+63.7%); Premiums: 31,727 (+8.0%); Products: 8,377 (+643.3%); Services: 3,315 (+19.9%).
- UnitedHealthcare: 32,830 (+7.9%); Optum: 21,899 (+70.1%).
- Premiums: Employer & Ind: 12,055 (+12.4%); Medicare & Retirement: 12,128 (+5.5%); Community & State: 7,409 (+13.7%); International: 1,238 (-27.3%).
- Medical Costs: 26,229 (+11.5%); Operating Costs: 41,131 (+34.1%); Net Income: 1,252 (-17.1%); EPS: 1.26 (-18.7%); Non-GAAP EPS: 1.40 (-14.6%); CF Ops: 3,511 (+243.9%).
- OptumHealth: 3,668 (+21.6%); OptumInsight: 1,812 (+21.9%); OptumRx: 16,657 (+95.8%).
- 2016 Guidance: Total Revenues: >$180B; Non-GAAP EPS: $7.60 - 7.80; CF Ops: $9.5B - 10.0B.
Tue, Jan. 19, 5:58 AM
- UnitedHealth Group (NYSE:UNH): Q4 EPS of $1.40 beats by $0.02.
- Revenue of $43.6B (+30.4% Y/Y) beats by $370M.
Mon, Jan. 18, 5:30 PM
Thu, Jan. 14, 2:51 AM
- WebMD (NASDAQ:WBMD), the U.S. online health information publisher, is exploring the possible sale of all or part of its business, FT reports.
- The company is said to be in talks with Walgreens Boots Alliance (NASDAQ:WBA) and UnitedHealth (NYSE:UNH), among other potential buyers.
- Since the start of the year WebMD shares have risen 10%, giving the company a market value of close to $2B.
- Update: Shares are up 6% premarket on increased volume.
Wed, Jan. 13, 8:28 AM
- According to Bloomberg, heath insurer Anthem (NYSE:ANTM) is aiming to get an additional $3B per year in drug discounts from pharmacy benefits manager (PBM) Express Scripts (NASDAQ:ESRX) and, if it doesn't get it, is threatening to take its business elsewhere.
- Anthem CEO Joseph Swedish commented on the tussle yesterday at the J.P. Morgan Healthcare Conference in San Francisco. "We are entitled to improved pharmaceutical pricing that equates to an annual value capture of more than $3B. To be clear, this is the amount by which we would be overpaying for pharmaceuticals on an annual basis. Much of those savings would be passed on to clients."
- Anthem has an unusual relationship with Express under which it is entitled to periodic reviews of the prices it pays for drugs, the last of which occurred in 2012. The arrangement stems from Anthem's sale of its PBM business to Express in 2009.
- Express spokesman Brian Henry says that Anthem is mischaracterizing the situation, adding, "Express Scripts has consistently acted in good faith and is in full compliance with the terms of its agreement. While the contract calls for good faith negotiations regarding a pricing review, it does not mandate specific price adjustments. Furthermore, Anthem is not entitled to $3B."
- Negotiations are ongoing. If Anthem makes good on its threat, it only has two choices of PBMs, CVS Health (NYSE:CVS) and UnitedHealth Group's (NYSE:UNH) OptumRx. According to Evercore ISI's Ross Muken, Anthem's exit would shave $0.80 per share off ESRX's earnings.
- ESRX is down 5% premarket on light volume.
Dec. 21, 2015, 8:41 AM
- Foundation Medicine (NASDAQ:FMI) signs a national agreement with UnitedHealthcare (NYSE:UNH) for coverage of FoundationOne, a comprehensive genomic profiling assay for solid tumors in patients with metastatic stage IV non-small cell lung cancer (NSCLC). About half of NSCLC patients are metastatic at the time of diagnosis.
- The FoundationOne test helps inform doctors on the best therapeutic approaches for their NSCLC patients by identifying the molecular growth drivers of their cancers. It interrogates the entire coding sequence of 315 cancer-related genes plus select introns (noncoding sections of RNA) from 28 genes that are known to be altered in solid tumors.
- The specific level of coverage is not disclosed.
Dec. 11, 2015, 7:48 AM
- Sanofi (NYSE:SNY) and Regeneron (NASDAQ:REGN) edge out Amgen (NASDAQ:AMGN) for preferred access status for their PCSK9 inhibitor Praluent (alirocumab) in UnitedHealth Group's (NYSE:UNH) OptumRx and UnitedHealthcare for Commercial, Medicare and Managed Medicaid patients. Praluent is now on formularies covering more than 100M patients in the U.S., including Express Scripts and Aetna.
- Amgen's Repatha (evolocumab) is the preferred offering in CVS Health and the exclusive PCSK9 inhibitor for members of Harvard Pilgrim Health System. Express Scripts offers it as well. Patients covered in UnitedHealth's Oxford unit can transition to Repatha if a 12-week regimen of Praluent fails to do the job.
- Previously: Repatha and Praluent go toe-to-toe in PBMs (Dec. 1)
Dec. 1, 2015, 12:53 PM
- In a shining example of the beauty of competition, Amgen (AMGN +0.5%) is battling fiercely with Sanofi (SNY) and Regeneron (REGN -0.4%) for favored status of its cholesterol fighter Repatha (evolocumab) versus Praluent (alirocumab) in the leading pharmacy benefit managers (PBMs).
- Amgen won preferred listing in CVS Health (CVS +1.4%) and an exclusive deal with Harvard Pilgrim Health System. Express Scripts (ESRX +1.2%) covers both PCSK9 inhibitors while UnitedHealth's (UNH +2.5%) Oxford unit is taking a different approach. Plan members will have to try Praluent first. If it fails to do the job after 12 weeks, then they can try Repatha.
- UnitedHealth and its OptumRx PBM are largest unsigned accounts and are, no doubt, getting substantial exposure to the companies' representatives.
Nov. 30, 2015, 5:21 PM
- UnitedHealth Group (NYSE:UNH) plans to discuss next year's guidance at its annual Investor Conference tomorrow in New York.
- It expects revenues of $180B - 181B, GAAP EPS of $7.10 - 7.30, non-GAAP EPS of $7.60 - 7.80 and CF Ops of $9.5B - 10.0B.
- Management also affirms its 2015 GAAP EPS of $6.00 and non-GAAP EPS of $6.45.
Nov. 20, 2015, 7:11 PM
- Shares of health insurance companies rebounded today after several major insurers issued reassuring statements that their profits were on track, a day after UnitedHealth (NYSE:UNH) cut its 2015 forecast, reported deep losses from its Affordable Care Act exchange business and said it will decide next year whether it wants to continue in that market.
- Aetna (NYSE:AET) and Anthem (NYSE:ANTM) backed their profit outlooks for the year and said their individual commercial businesses were performing within expectations.
- Leerink analyst Ana Gupte reiterated Outperform ratings on AET and ANTM, saying both companies' reaffirmation of 2015 EPS guidance - $7.45-$7.55 for AET, and $10.10-$10.20 for ANTM - met her expectations.
- Molina Healthcare (NYSE:MOH) said it is seeing profits on its exchange business, and CEO Mario Molina said the company was not seeing the issues UNH had raised.
- Centene (NYSE:CNC) also backed its outlook and said its marketplace business is performing as expected.
UnitedHealth Group, Inc. provides health care coverage, software and data consultancy services. The company operates through four business segments: UnitedHealthcare, OptumHealth, OptumInsight and OptumRx. The UnitedHealthcare segment includes UnitedHealthcare Employer & Individual,... More
Industry: Health Care Plans
Country: United States
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