Health insurer Aetna tops Wall Street 3rd quarter estimates, raises 2014 forecast

Aetna became the latest major health insurer to thump analyst expectations for the third quarter and then raise its forecast for 2014.

Shares of the Hartford, Connecticut, company climbed in premarket trading after the nation's third-largest health insurer said its bottom line rose 15 percent in the quarter that ended Sept. 30, helped in part by enrollment gains and a growing government business.

Aetna Inc. said it now expects 2014 earnings, excluding one-time items, to range between $6.60 and $6.70 per share. That's up from a forecast it made in July for $6.45 to $6.60 per share.

It also topped average analyst expectations of $6.59 per share, according to FactSet.

Overall, Aetna earned $594.5 million, or $1.67 per share, in the third quarter. That compares to net income of $518.6 million, or $1.38 per share, the previous year.

Adjusted earnings totaled $1.79 per share.

Analysts expected, on average, $1.58 per share, according to Zacks Investment Research.

Operating revenue, which excludes investment gains and losses, grew 13 percent to $14.7 billion, which also surpassed average expectations for $14.62 billion.

Aetna is the nation's third-largest health insurer, trailing only UnitedHealth Group Inc. and WellPoint Inc. Health insurance is Aetna's main product, but the company also sells dental, group life and disability coverage.

Earlier this month, UnitedHealth reported results that topped expectations. It also raised its forecast for 2014and said it expects solid growth next year as well. WellPoint reports results on Wednesday.

Shares of Aetna climbed $1.82, or 2.3 percent, to $81 in premarket trading about 2 ½ hours ahead of the market open. The stock has climbed 15 percent since the beginning of the year, more than doubling the growth of the Standard & Poor's 500 index.

Shares of Aetna, UnitedHealth Group and WellPoint have all hit several all-time high prices so far this year.


Elements of this story were generated by Automated Insights using data from Zacks Investment Research. AET stock research report from Zacks.


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