HWAY and SulAmerica Join Forces, Shares Fall - Analyst Blog


Healthways Inc . ( HWAY ) has forged a new five-year agreement with SulAmérica, the largest independent health insurer in Brazil, to flag off Latin America's most comprehensive private health and well-being improvement program. However, not benefiting much from this news, shares of HWAY declined 14 cents, closing the session at $14.03 on Dec 6.

However, this information failed to uplift the sentiments of the investment community as the above contract was announced in the month of April. Moreover, the non-renewal of the Cigna contract was a major setback for the company, as it is believed that the company is still trying to recover from its losses. Further, a sluggish US economy and uncertainty over the US healthcare reform measures hamper the future growth prospects of Healthways.

In April, both the organizations had announced a joint strategic alliance with the motive of boosting well-being and performance improvement for employers and individuals in Brazil.

SulAmérica is the forerunner in the Brazilian private healthcare insurance market that is the second largest in the world, covering nearly 25% of the country's population. It is optimistic about its extended collaboration with Healthways, and seeks to enhance value for its employer clients in the form of healthier, happier and more productive employees.

Per the new agreement, both Healthways and SulAmérica will launch innovative programs in 2014 that will give the latter's members a clear idea of their unique well-being scores. Customized plans and a diverse portfolio of tailor-made programs will cater to the needs of SulAmérica's customers to being about lifestyle and well-being improvements.

This agreement records the largest population ever managed under a single private contract in Latin America. As an initiative to start off the program, a section of SulAmérica's members participated in Healthways' Well-Being Assessment to measure their well-being status.

Healthways looks forward to this partnership to deliver long-term value to SulAmérica's customers by allowing their employees to lead disease-free, healthy lives. This, in turn, will spell wonders for their organizations in the form of greater competitive strength and improved financials, gained on the back of high-performing employees.

Currently, Healthways carries a Zacks Rank #5 (Strong Sell). However, investors interested in the industry can look at stocks like Air Methods Corp. ( AIRM ), BG Medicine, Inc . ( BGMD ) and Acadia Healthcare Company, Inc. ( ACHC ). While Air Methods sports a Zacks Rank #1 (Strong Buy), BG Medicine and Acadia Healthcare carry a Zacks Rank #2 (Buy).

ACADIA HEALTHCR (ACHC): Free Stock Analysis Report

AIR METHODS CRP (AIRM): Free Stock Analysis Report

BG MEDICINE INC (BGMD): Free Stock Analysis Report

HEALTHWAYS INC (HWAY): 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: ACHC , AIRM , BGMD , HWAY



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