Wedbush Cuts Price Target & Estimates on AMERIGROUP (AGP) Medicaid Rates Look Negative in TX, GA, FL
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Price: $91.70 --0%
Rating Summary:
3 Buy, 14 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 7 | Down: 5 | New: 25
Rating Summary:
3 Buy, 14 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 7 | Down: 5 | New: 25
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Wedbush is reiterating its Outperform rating on shares of AMERIGROUP (NYSE: AGP), but is cutting its price target from $75 to $65.
The firm indicates that while its early in the rate-setting cycle, checks suggest negative rates in GA and FL and negative rates of 5.4 percent for the company in TX.
An analyst at Wedbush comments, "We continue to like the Medicaid space long term as we believe the growth potential from new contract awards and program expansion is not fully valued into the stocks. Currently the RFP pipeline is the largest we have seen since 2005, with more than $40 billion in contracts to be awarded by 2013 covering 11 million eligibles in over 20 states. We believe AGP is well positioned for these upcoming awards as it is one of the largest players in several expansion states and has broad experience in ABD and LTC."
The firm cut its FY11 and FY12 EPS estimates from $4.47 and $4.42 to $4.00 and $4.19. It also reduced its revenue estimates from $6.36 billion and $7.05 billion to $6.19 billion and $6.74 billion.
For more ratings news on AMERIGROUP click here and for the rating history of AMERIGROUP click here.
Shares of AMERIGROUP closed at $55.00 yesterday.
The firm indicates that while its early in the rate-setting cycle, checks suggest negative rates in GA and FL and negative rates of 5.4 percent for the company in TX.
An analyst at Wedbush comments, "We continue to like the Medicaid space long term as we believe the growth potential from new contract awards and program expansion is not fully valued into the stocks. Currently the RFP pipeline is the largest we have seen since 2005, with more than $40 billion in contracts to be awarded by 2013 covering 11 million eligibles in over 20 states. We believe AGP is well positioned for these upcoming awards as it is one of the largest players in several expansion states and has broad experience in ABD and LTC."
The firm cut its FY11 and FY12 EPS estimates from $4.47 and $4.42 to $4.00 and $4.19. It also reduced its revenue estimates from $6.36 billion and $7.05 billion to $6.19 billion and $6.74 billion.
For more ratings news on AMERIGROUP click here and for the rating history of AMERIGROUP click here.
Shares of AMERIGROUP closed at $55.00 yesterday.
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