Health insurance provider CareFirst strengthened its
) by making a strategic investment of $20 million in the latter.
The investment will bring further growth and innovation in
CareFirst's Patient Centered Medical Home (PCMH) program, which
serves more than a million CareFirst members with an emphasis on
patients with multiple chronic conditions.
Healthways provides services and technology to the PCMH program
as well as Disease Management services to CareFirst members. With
the additional investment, the companies expect further
opportunities for growth in PCMH program.
CareFirst is an independent licensee of the Blue Cross and Blue
Shield Association, a federation of 38 separate health insurance
organizations and companies in the U.S. This non-profit
organization serves 3.4 million people in Maryland, the District
of Columbia and some areas of Northern Virginia. CareFirst
contributed nearly $57 million to community programs in 2012.
HWAY provides focused and complete solutions which enable people
to improve their physical, emotional and social well-being. The
company's programs are designed to encourage people to make
favorable lifestyle changes, such as physical activity for elders
at the fitness centers (SilverSneakers) or nicotine therapy via
the on-line cigarette cessation program (QuitNet).
In the second quarter of the year, Healthways reported
second-quarter 2013 loss per share of 3 cents, narrower than the
Zacks Consensus Estimate and the company's expectations of a loss
of 5 cents per share. However, the result is worse than the
year-ago earnings of 15 cents per share.
Revenues declined 4.7% year over year to $162.3 million in the
quarter, trailing the Zacks Consensus Estimate of $171 million.
However, upon exclusion of the two terminal contracts, revenues
improved 11.7% from the prior-year quarter.
HWAY affirmed its sales guidance for 2013. The company continues
to expect sales in a band of $710 million-$750 million,
reflecting growth of 5%-11% year over year. It expects higher
revenues for 2013 despite a drop of $80 million on account of the
termination of two contracts. Healthways forecasts higher sales
in the second half of 2013 as fresh contracts inked in 2012 take
off in the upcoming quarters.
However, Healthways tweaked its outlook for bottom line to
reflect the effect of its cash convertible senior notes due 2018.
The company expects earnings per share of about 18 cents-28 cents
compared with prior outlook of 25 cents-35 cents for 2013.
Healthways currently carries a Zacks Rank #3 (Hold). Other scrips
that are worth a look in the medical services industry include
BG Medicine, Inc.
PAREXEL International Corporation
). All of them carry a Zacks Rabk #2 (Buy).
BG MEDICINE INC (BGMD): Free Stock Analysis
COVANCE INC (CVD): Free Stock Analysis Report
HEALTHWAYS INC (HWAY): Free Stock Analysis
PAREXEL INTL CP (PRXL): Free Stock Analysis
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