WellPoint (WLP) narrowed its first-quarter profit on a decline in membership, but the No. 2 health insurer beat Wall Street expectations, leading it to raise its fiscal 2012 outlook.
The Indianapolis company reported net income of $856.5 million, or $2.53 a share, compared with a year-earlier $926.6 million, or $2.44 a share, in the year-earlier period.
Excluding one-time items, WellPoint earned $2.34 a share, ahead of average analyst estimates of $2.27 in a Thomson Reuters poll.
The results led the company to raise its full-year earnings forecast to at least $7.65 a share, excluding items. That’s up from an earlier projection of $7.60 but below analysts’ forecast of $7.74.
Revenue for the latest quarter was $15.15 billion, up 3.4% from $14.65 billion a year ago, but below the Street’s view of $15.27 billion. The weaker-than-expected results were tied to a 1.5% decline in membership to about 33.7 million.
Health insurers, held down for the past several quarters as consumers stayed clear of the doctor amid weak economic conditions, have started posting optimistic reports amid a slight rebound in customer traffic.
WellPoint’s larger rival, UnitedHealth (UNH) last week reported stronger-than-expected earnings and lifted its fiscal 2012 profit forecast.
WellPoint’s consumer business climbed nearly 6% during the first quarter to $217.7 million; a sign demand for the company’s Medicare Advantage plans is starting to kick up.