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 Puerto Rican managed-care company Triple-S Management (NYSE:GTS) popped 11% today after its quarterly results topped Wall Street expectations.
So what: The stock has slumped since fall on concerns over weakness in its Medicare Advantage business, but a wide first-quarter profit beat -- adjusted EPS of $0.55 versus the consensus of just $0.35 -- suggests that management's turnaround initiatives are gaining traction. In fact, the company's Managed Care medical loss ratio fell by a significant 480 basis points over the year-ago period, giving investors plenty of good vibes about its profitability going forward.
Now what: Management reaffirmed its full-year adjusted EPS of $1.90-$2.00 on operating revenue of $2.35 billion-$2.45 billion, in line with analyst estimates of $1.99 and $2.39 billion. "While we generated better-than-anticipated earnings in the period, as we are only one quarter into the year, we have elected to maintain our full-year guidance," said CEO Ramon Ruiz-Comas. "We believe that this posture is prudent until we have additional data further into 2013." Of course, when you couple that conservative outlook with the clear operating momentum currently working in Triple-S's favor, a string of upside surprises over the next year seems like a strong possibility.
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