The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Aetna met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share improved significantly.
Margins grew across the board.
Aetna booked revenue of $8.54 billion. The 12 analysts polled by S&P Capital IQ expected sales of $8.51 billion. Sales were 0.4% higher than the prior-year quarter's $8.51 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.97. The 20 earnings estimates compiled by S&P Capital IQ predicted $0.96 per share on the same basis. GAAP EPS of $1.03 for Q4 were 91% higher than the prior-year quarter's $0.54 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 29.6%, 270 basis points better than the prior-year quarter. Operating margin was 7.8%, 310 basis points better than the prior-year quarter. Net margin was 4.3%, 180 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $8.74 billion. On the bottom line, the average EPS estimate is $1.37.
Next year's average estimate for revenue is $35.44 billion. The average EPS estimate is $5.09.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 561 members out of 607 rating the stock outperform, and 46 members rating it underperform. Among 215 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 210 give Aetna a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Aetna is outperform, with an average price target of $50.50.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.