AET Gives Detailed Guidance for 2013 - Analyst Blog


At the recently held investors conference the U.S. health insurer Aetna Inc. ( AET ) reiterated its full year 2013 operating earnings guidance of $5.40 per share. The Zacks Consensus Estimate for full year 2013 earnings also stands at $5.40 per share. 

The company also gave other guidance for 2013. It continues to project net dividends from subsidiaries of approximately $1.1 billion and deployable capital of approximately $500 million.

For 2013, operating expense ratio is projected to be 18% - 18.5%, an improvement over 2012. The improvement is expected to come on the back of growth in total revenue which is expected to surpass the growth rate in operating expenses.

The health insurer pretax operating margin is projected to be 8%, plus or minus 25 basis points, consistent with its high single-digit target. The projected downward pressure on pretax operating margin is expected to come from a mix shift in the crediting of favorable experience to its Large Group Insured customers, partially offset by operating expense leverage.

In aggregate Aetna expects to see operating earnings of approximately $1.75 billion in 2013, roughly flat with 2012 levels.

For 2013 the company is focusing on six strategic goals for long term growth. These include diversification of business, growth of Large group business, developing its government franchise business, successfully integrating and acquiring Coventry Health Care, Inc. ,( CVH ), enhancing its accountable care strategy as well as expanding its small group and individual business.    

Aetna retains a Zacks Rank #3 (Hold). 

Another health insurer UnitedHealth Group Inc. ( UNH ) reaffirmed the previously issued earnings guidance for 2013. It continues to expect revenues of $123 billion to $124 billion and net earnings in the range of $5.25 to $5.50 per share.  Yet another player CIGNA Corp. ( CI ) announced delivery of operating earnings between $1.7-$1.83 billion or $5.85-$6.30 per share in 2013.

AETNA INC-NEW (AET): Free Stock Analysis Report

CIGNA CORP (CI): Free Stock Analysis Report

COVENTRY HLTHCR (CVH): Free Stock Analysis Report

UNITEDHEALTH GP (UNH): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: AET , CI , CVH , UNH

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