Five analysts have increased their EPS forecasts for this healthcare company’s current quarter (earnings due next week); two have raised their estimates for next year and one for 2017—all in the last 30 days.
WellCare Health Plans (WCG)
From Cabot Undervalued Stock Advisor
WellCare Health Plans (WCG) is an undervalued aggressive growth stock in the managed healthcare sector. As financial pundits anticipate the merger between health benefit companies Anthem (ANTM) and Cigna (CI) to be denied by the Justice Dept. due to antitrust concerns, speculation continues that Cigna will subsequently acquire a healthcare company with its $1.85 billion breakup fee from Anthem. WellCare is repeatedly identified as the most likely target of a Cigna takeover bid.
WCG would be relatively fairly valued at 126, based on its expected 2017 EPS. The stock has a bullish price chart, recently trading between 103 and 109. It’s entirely possible that WCG will break past 109 in the coming days. Be ready to buy on the breakout and/or to buy on any pullback toward 104.
Analysts are expecting second quarter EPS of $1.40 when WellCare reports results on the morning of August 2. The share price appears poised for an immediate run-up. Strong Buy.
Crista Huff, Cabot Undervalued Stocks Advisor, www.cabot.net, 9787455532, July 5, 19, and 26, 2016