Centene (NYSE:CNC) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research report issued on Tuesday.
According to Zacks, “Centene is burdened with high debts. The long-term debt has been rising since 2005. This is mainly because the company’s acquisitions are financed majorly by borrowings. Apart from long term debt, increasing interest expenses weighs on its margins. Apart from the increasing level of debt, the company’s bottom line is substantially hurt by higher operating costs. Since 2007, total operating costs have been increasing significantly. Centene’s shares have outperformed its industry’s gain in the past year. The company has been performing really well on the back of higher revenues, primarily driven by growth in the Health Insurance Marketplace business in 2018, strategic acquisitions, expansions and new programs across many of the states in 2017 and 2018 as well as the reinstatement of the health insurer fee in 2018. It has raised its 2018 guidance after solid performance in the second quarter.”
Other analysts have also recently issued research reports about the stock. Bank of America boosted their target price on shares of Centene from $145.00 to $158.00 and gave the stock a “buy” rating in a research note on Tuesday, July 24th. Leerink Swann lifted their price target on shares of Centene from $120.00 to $130.00 and gave the stock a “market perform” rating in a report on Monday, June 18th. Piper Jaffray Companies reiterated a “buy” rating and set a $152.00 price target on shares of Centene in a report on Wednesday, July 25th. MED reiterated an “outperform” rating and set a $146.00 price target (up previously from $138.00) on shares of Centene in a report on Wednesday, July 25th. Finally, Cantor Fitzgerald lifted their price target on shares of Centene to $137.00 and gave the stock an “overweight” rating in a report on Monday, June 18th. One research analyst has rated the stock with a sell rating, three have given a hold rating and fourteen have given a buy rating to the stock. The stock currently has a consensus rating of “Buy” and an average target price of $147.29.
NYSE CNC opened at $141.58 on Tuesday. The firm has a market cap of $29.19 billion, a price-to-earnings ratio of 22.61, a P/E/G ratio of 1.37 and a beta of 0.85. Centene has a fifty-two week low of $83.56 and a fifty-two week high of $148.24. The company has a current ratio of 1.25, a quick ratio of 1.26 and a debt-to-equity ratio of 0.59.
Centene (NYSE:CNC) last posted its earnings results on Tuesday, July 24th. The company reported $1.80 earnings per share for the quarter, topping analysts’ consensus estimates of $1.77 by $0.03. The firm had revenue of $14.18 billion for the quarter, compared to analysts’ expectations of $13.82 billion. Centene had a net margin of 2.06% and a return on equity of 14.57%. The company’s revenue was up 18.6% on a year-over-year basis. During the same quarter in the previous year, the firm posted $1.59 earnings per share. sell-side analysts predict that Centene will post 7.08 earnings per share for the current year.
In related news, EVP Christopher D. Bowers sold 3,800 shares of the business’s stock in a transaction on Monday, September 10th. The shares were sold at an average price of $145.55, for a total value of $553,090.00. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, Director Robert K. Ditmore sold 8,750 shares of the business’s stock in a transaction on Thursday, July 26th. The shares were sold at an average price of $131.44, for a total transaction of $1,150,100.00. Following the completion of the transaction, the director now owns 472,241 shares in the company, valued at approximately $62,071,357.04. The disclosure for this sale can be found here. In the last quarter, insiders have sold 30,550 shares of company stock worth $4,274,790. 3.00% of the stock is owned by company insiders.
A number of hedge funds have recently added to or reduced their stakes in CNC. Financial Gravity Wealth Inc. acquired a new position in Centene in the first quarter valued at $114,000. Fort L.P. acquired a new position in Centene in the second quarter valued at $122,000. IMA Wealth Inc. acquired a new position in Centene in the second quarter valued at $124,000. Steward Partners Investment Advisory LLC lifted its holdings in Centene by 127.2% in the second quarter. Steward Partners Investment Advisory LLC now owns 1,254 shares of the company’s stock valued at $155,000 after buying an additional 702 shares during the period. Finally, Cornerstone Wealth Management LLC acquired a new position in Centene in the second quarter valued at $157,000. Institutional investors and hedge funds own 90.04% of the company’s stock.
Centene Company Profile
Centene Corporation operates as a diversified and multi-national healthcare enterprise that provides programs and services to under-insured and uninsured individuals in the United States. It operates through two segments, Managed Care and Specialty Services. The Managed Care segment offers health plan coverage to individuals through government subsidized programs, including Medicaid, the State children's health insurance program, long-term care, foster care, and dual eligible individual, as well as aged, blind, or disabled programs.
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