IBJNews

WellPoint's 3rd-quarter profit falls, but beats analyst estimates

Back to TopCommentsE-mailPrintBookmark and Share

Third-quarter profit fell nearly 8 percent at WellPoint Inc. but exceeded the expectations of Wall Street analysts.

And the Indianapolis-based health insurer raised its profit forecast for the rest of the year, the company announced Wednesday morning.

WellPoint earned $683.2 million, down 7.6 percent from the same quarter a year ago, when WellPoint earned $739.1 million.

On a per-share basis, the results appear better because WellPoint has repurchased nearly 42 million shares in the past year, a 10-percent reduction of its shares outstanding.

In the third quarter, the company recorded per-share profit of $1.90. Excluding investment gains, the company would have earned $1.77 per share, 3 cents higher than the in third quarter last year.

Analysts were expecting $1.68 per share, according to a survey by Thomson Reuters.

WellPoint’s operating revenue in the quarter rose nearly 6 percent, to $15.16 billion, narrowly topping analysts’ forecast of $15.12 billion.

The company's stock was up nearly 2 percent in late-morning trading, to $68.30 per share.

"We added 169,000 medical members during the third quarter and have now grown by more than one million members on a year-to-date basis, while reducing selling, general and administrative expenses by $185 million, or nearly 3 percent,” noted CEO Angela Braly in a prepared statement.

WellPoint now provides health benefits for 34.4 million people, more than any other U.S. company.

Excluding investment gains, WellPoint expects to report full-year profit of at least $6.90 per share and as much as $7.00 per share. In July, the company set its profit forecast in a range of $6.75 to $6.90.

WellPoint’s stock price has risen 18 percent this year, with another 1-percent return from dividends.

WellPoint reported its second-strongest quarter of enrollment growth in the last three years, benefiting from the $800 million acquisition of CareMore Health Group and increases in its smaller business and senior market, said Jason Gurda, an analyst at Leerink Swann in New York.

Braly said the company was happy with the growth in its senior market and is looking to make more investment in it through acquisitions and expanding its CareMore clinics. She said WellPoint will add a dozen facilities in 2012.

“The senior business is where we’re looking to make investment, growing it both organically and through acquisition,” Braly said on the analyst conference call.

The enrollment gains include a jump of 99,000 in small-business membership, mostly from companies with fewer than a 1,000 employees, said Sarah James, an analyst at Wedbush Securities Inc. in Los Angeles. The enrollment also was boosted by 89,000 in new seniors, including 57,000 that came from CareMore, WellPoint said. The insurer bought the senior-focused clinic network in June.

“We began to get hints of enrollment gains last year,” said Thomas A. Carroll, an analyst at Stifel Nicolaus & Co. in Baltimore. “I think it’s a reflection that the economy may be improving as employers begin to hire again. It looks like a good, clean quarter for WellPoint.”

ADVERTISEMENT

  • That is such a shame
    I really hate to hear that they only made 682 million. They can't even pay their employees a decent salary and not to mention their own medical plan for their employees sucks!

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
thisissue1-092914.jpg 092914

Subscribe to IBJ
  1. Here are a few candidates for this new group, "ripped from the headlines." First up, that bizzaro State Senator Brent Waltz; secondly, the unethical Todd Huston, and his contractual arrangements scheme; Finally, but not least of all, the dishonorable Eric Turner. What sayeth you Greg Zoeller?

  2. Good day. I can't hide this great testimony that take place in my life I will love everyone to know it and be partaker that is why I always place it on answer, I am Mrs,Natalie Cuttaia by name, I live in Texas, United State Of America, I want to thank (Mr.Bruce Brandon) for his kindness upon my family life. I never knew that there is still nice lender like this on internet and earth here. Just some Months Back, I was in search for a loan of $100,000,00 as I was running out of money for feeding and rent. I was scammed $6,800 Dollars and I decided not to involve my self in such business again but a Friend of my introduced me to a loan firm due to my appearance and doings. And I told him that I am not interested of any loan deal anymore but he told me that there is still a nice lender who he will recommend me to, and I made a trial and I am most grateful lucky am I today, I was given a loan amount of $100,000.00usd, by this great Company (Bruce Brandon Loan Company) managed by (Mr.Bruce Brandon) If you are in need of a genuine or legit loan or financial assistance and you can be reliable and trusted of capable of paying back at the due time of the funds I will advice you to, contact him via: ( bruce.brandon071@gmail.com ) And you will be free from scams in the internet. All thanks to Mr.Bruce Brandon You are the one who remove me and my family out of poverty. The reason why i am doing this is that, i promise Mr.Bruce Brandon that if i truly got my loan, i will advertize his company and bring customers to his company. Contact him via ( bruce.brandon071@gmail.com )for the Loan you have been looking for..

  3. Hello, We are firm Organization formed to help people in needs of helps,such as financial help. So if you are going through financial difficulty or you are in any financial mess,and you need funds to start up your own business,or you need loan to settle your debt or pay off your bills,start a nice business, or you are finding it hard to obtain capital loan from local banks,contact us today via email mrsroseberrywilkinsfunds.usa@gmail.com So do not let these opportunity pass you by because Jesus is the same yesterday, today and forever more. Please these is for serious minded and God fearing People. Your Name: Loan Amount: Loan Duration: Valid Cell Phone Number: Thanks for your understanding to your contact as we Await Regards Management Email:mrsroseberrywilkinsfunds.usa@gmail.com

  4. The question is, where could they build a new stadium? It seems in the past year, all the prime spots have been spoken for with potential projects. Maybe in the industrial wasteland area a block past Lucas Oil? I think it needs to be close to the core, if a new stadium is built.

  5. Aldi is generally a great shopping experience. Still, I'm sure YOU wouldn't want to shop there, which I consider a positive.

ADVERTISEMENT