Wedbush Reiterates a 'Neutral WellCare Health Plans (WCG); View As A Potential Take Out Candidate
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Price: $349.92 --0%
Rating Summary:
12 Buy, 12 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 9
Rating Summary:
12 Buy, 12 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 9
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Wedbush reiterates a 'Neutral WellCare Health Plans (NYSE: WCG).
Wedbush analyst says, "WellCare enters definitive agreement for $137.5M whistleblower lawsuit. The settlement was in line with expectations and due over a period of 36 months and carried interest of 3.75%. Management previously stated they expect to pay $11.4M of this during 2011."
"60M ($1.40/share) kick payment for change of control not insurmountable; continue to view WCG as a take-out candidate but more likely from a PE firm than a managed care plan. After speaking with management teams at several
large managed care plans we no longer see WellCare as a likely acquisition target by its peers that said we would not rule out a PE firm being interested in the company given the removal of the legal overhang and the growth in the Medicare and Medicaid sectors. Specifically at Aetna, we believe the company is focused on growing their Medicaid product organically, at CIGNA (NYSE: CI), we believe management is weighing the need to have a Medicaid product as they may choose to approach exchanges in select states that do not require continuity of care between the products, and at HealthSpring, we believe the company will take a measured approach to entering Medicaid waiting to see how the 2012 TX expansion plays out which from a timing perspective makes WCG an unlikely acquisition in our opinion."
For more ratings news on WellCare Health Plans click here and for the rating history of WellCare Health Plans click here.
Shares of WellCare Health Plans closed at $43.70 yesterday.
Wedbush analyst says, "WellCare enters definitive agreement for $137.5M whistleblower lawsuit. The settlement was in line with expectations and due over a period of 36 months and carried interest of 3.75%. Management previously stated they expect to pay $11.4M of this during 2011."
"60M ($1.40/share) kick payment for change of control not insurmountable; continue to view WCG as a take-out candidate but more likely from a PE firm than a managed care plan. After speaking with management teams at several
large managed care plans we no longer see WellCare as a likely acquisition target by its peers that said we would not rule out a PE firm being interested in the company given the removal of the legal overhang and the growth in the Medicare and Medicaid sectors. Specifically at Aetna, we believe the company is focused on growing their Medicaid product organically, at CIGNA (NYSE: CI), we believe management is weighing the need to have a Medicaid product as they may choose to approach exchanges in select states that do not require continuity of care between the products, and at HealthSpring, we believe the company will take a measured approach to entering Medicaid waiting to see how the 2012 TX expansion plays out which from a timing perspective makes WCG an unlikely acquisition in our opinion."
For more ratings news on WellCare Health Plans click here and for the rating history of WellCare Health Plans click here.
Shares of WellCare Health Plans closed at $43.70 yesterday.
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