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Why Centene Shares Tumbled

By Travis Hoium – Updated Apr 7, 2017 at 5:52PM

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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 Medicaid provider Centene (NYSE: CNC) fell 13% today after getting some bad news out of the state of Ohio.

So what: The Ohio Department of Job and Family Services said that Centene's subsidiary there, Buckeye Community Health Plan, was one of four incumbent health plans that was not awarded a contract to continue serving Medicaid members. The plan has been a participant in Ohio since 2004 and serves 159,900 people.

Now what: Centene plans to file a formal protest, but this doesn't look good for the company. Aetna and Meridian Health were picked to replace Centene and Molina Healthcare, which also lost its contract. Molina's stock has also tumbled, while Aetna's shares have fallen slightly in trading today.

Interested in more info on Centene? Add it to your watchlist by clicking here.

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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