WellCare Health Plans Popped: What You Need to Know (WCG)

WellCare Health Plans Popped: What You Need to Know

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Good news doesn't get much better than this. When WellCare Health Plans (NYSE: WCG ) reported earnings this morning, it quite simply crushed analyst estimates. Per-share profits of $0.50 were more than triple analysts' estimated $0.16 for the quarter and a 233% improvement over last year's $0.15 earnings.

So what: And that was only the start of the good news. Based on trends in increased membership and lower payouts for medical procedures, WellCare increased its earnings guidance for the year by all 34 cents' worth of the first quarter's beat -- and then it tossed in another $0.56 in guidance-uppage for good measure.

Now what: All told, WellCare now expects to earn at least $3.35 per share this year, and perhaps as much as $3.65. At the midpoint of that guidance, we're looking now at a stock priced at 13.6 times this year's probable earnings. That's not too far ahead of the 10.8% growth rate that Wall Street has it pegged for, but it's not an obvious bargain either, though.

My guess: The valuation is the only reason the stock didn't leap higher than today's 13% jump. The news really was that good. It's just a shame that the stock price isn't.

Want to learn more about WellCare Health Plans? Add it to your watchlist.

The Steve Jobs Betrayal
You may already know that in the final year of his life, Jobs revealed a stunning betrayal — and told his biographer, "I will spend my last dying breath... and every penny of Apple's $40 billion in the bank to right this wrong." What was it that made Jobs so irate — and why could it make a few in-the-know investors some major profits over the coming months and years?

Enter your email address below to find out what made Jobs so enraged!

Fool contributor Rich Smith owns no shares of, nor is he short, any company named above.

We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment icon found on every comment.