UPDATE: Oppenheimer Starts Express Scripts (ESRX) at Perform

Oppenheimer initiated coverage on Express Scripts (NASDAQ: ESRX) with a Perform rating. Analyst Mohan Naidu sees the company's scale as a big advantage, but he noted Express Scripts was still far away from a growth recovery in claims.

"Despite the improvements since the Medco acquisition, retention and claims growth continue to be concerns for investors. We believe the disruptions post acquisition remain in customers’ minds, although the service has improved since then. The company’s leadership in membership positions it strongly in the growing specialty drug market, helping ESRX address major concerns for sponsors. ESRX had a strong 1/1 this year and expects 94-97% retention for CY16. But we are still far away from a growth recovery in claims, and we believe the competition is gaining momentum through organic and inorganic growth. We are optimistic about ESRX's position, but remain on the sidelines until we see signs of growth recovery," said Naidu.

For an analyst ratings summary and ratings history on Express Scripts click here. For more ratings news on Express Scripts click here.

Shares of Express Scripts closed at $88.09 yesterday.

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