Coventry Health (CVH) Slammed After Slashing EPS Guidance, Others Follow (AET, HUM, UNH, WLP)
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Shares of Coventry Health Care, Inc. (NYSE: CVH) are down 19% in after-hours action after slashing second quarter and full year 2008 EPS estimates.
The Company expects second quarter diluted earnings per share (EPS) in the range of $0.55 to $0.57 and full year diluted EPS in the range of $3.65 to $3.75. The consensus sis $1.04 and $4.43, respectively.
The company cited higher than expected patient claims and higher medical costs.
Coventry Health said it expects the 2008 Medicare Advantage medical loss ratio to be between 85.5% and 85.9%, an increase of approximately 300 to 340 bps from the Company's prior estimate. Coventry Health also said commercial group risk MLR is being pressured by higher than expected levels of outpatient utilization and, to a lesser extent, a higher than expected inpatient unit cost trend caused by an increased severity level of facility claims.
The news is also weighing down others in the group: Aetna (NYSE: AET) -10%, Humana (NYSE: HUM) -7%, UnitedHealth Group (NYSE: UNH) -8%, WellPoint Inc. (NYSE: WLP) -6%, CIGNA (NYSE: CI) -5%.
The Company expects second quarter diluted earnings per share (EPS) in the range of $0.55 to $0.57 and full year diluted EPS in the range of $3.65 to $3.75. The consensus sis $1.04 and $4.43, respectively.
The company cited higher than expected patient claims and higher medical costs.
Coventry Health said it expects the 2008 Medicare Advantage medical loss ratio to be between 85.5% and 85.9%, an increase of approximately 300 to 340 bps from the Company's prior estimate. Coventry Health also said commercial group risk MLR is being pressured by higher than expected levels of outpatient utilization and, to a lesser extent, a higher than expected inpatient unit cost trend caused by an increased severity level of facility claims.
The news is also weighing down others in the group: Aetna (NYSE: AET) -10%, Humana (NYSE: HUM) -7%, UnitedHealth Group (NYSE: UNH) -8%, WellPoint Inc. (NYSE: WLP) -6%, CIGNA (NYSE: CI) -5%.
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