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: Shares of health insurer Aetna
So what: Aetna posted fourth-quarter operating earnings today of $0.63, which edged out the $0.62 that Wall Street had expected. The profit, which includes adjustments for certain transactions and restructuring charges, was a 58% gain over last year's fourth quarter. The gain was driven in large part by lower expenses, including a lower medical benefit ratio, and was also helped by a lower share count. Revenue also topped analyst estimates, though it fell 2.5% from last year as membership in the company's programs declined.
Now what: It seems pretty unlikely that investors got too fired up about a $0.01 earnings beat. Instead, the excitement probably has more to do with the company's 2011 guidance and its dividend announcement. For 2011, Aetna expects to report between $3.70 and $3.80 in per-share operating earnings, which is well above the average analyst estimate of $3.65. Meanwhile, the company showed confidence in its business -- and matched a move by competitor Unitedhealth
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