Wells Fargo Starts Centene (CNC) at Market Perform, $32 to $35 Valuation Range
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Price: $67.47 +2.17%
Rating Summary:
19 Buy, 16 Hold, 1 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
19 Buy, 16 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Wells Fargo initiates coverage on shares of Centene (NYSE: CNC) with a Market Perform rating and a $32 to $35 valuation range.
The firm believes that medicaid populations, may partially offset potential new membership from winning new state Medicaid managed care contracts over the next two years.
With state government budgets still under fiscal pressure, Wells Fargo expects more states to again issue new RFPs for new managed care contracts for both TANF and ABD populations and notes that it would be an opportunity for the company.
Wells Fargo reports, "The biggest risk for Centene, in our view, is for them to suffer from margin contraction as states attempt to manage strained budgets and likely lower rates paid for Medicaid. We believe modest rate increases are needed to maintain margins, and that rate cuts are likely to mean margin pressure."
The firm is setting its 2011 and 2012 EPS estimates ate $2.09 and $2.30 and its revenue estimates at $5,383 million and $5,872 million.
For more ratings news on Centene click here and for the rating history of Centene click here.
Shares of Centene closed at $31.46 yesterday.
The firm believes that medicaid populations, may partially offset potential new membership from winning new state Medicaid managed care contracts over the next two years.
With state government budgets still under fiscal pressure, Wells Fargo expects more states to again issue new RFPs for new managed care contracts for both TANF and ABD populations and notes that it would be an opportunity for the company.
Wells Fargo reports, "The biggest risk for Centene, in our view, is for them to suffer from margin contraction as states attempt to manage strained budgets and likely lower rates paid for Medicaid. We believe modest rate increases are needed to maintain margins, and that rate cuts are likely to mean margin pressure."
The firm is setting its 2011 and 2012 EPS estimates ate $2.09 and $2.30 and its revenue estimates at $5,383 million and $5,872 million.
For more ratings news on Centene click here and for the rating history of Centene click here.
Shares of Centene closed at $31.46 yesterday.
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