Aetna Isn’t Getting Better

DESPITE ANNOUNCING weaker-than-expected fourth-quarter earnings this morning, Aetna shares were higher today as investors appeared to be betting that a turnaround would take hold. That said, we think this strength will prove to be fleeting and that investors will likely encounter a bumpy ride this year.

Let’s look at the numbers. Profit tumbled 14.8% to $165.9 million, or 38 cents a share, from 42 cents a share in the year-earlier period. Revenue rose to $8.76 billion, beating estimates of $8.55 billion, but the EPS results fell four cents short of analysts’ expectations.

This copy is for your personal, non-commerical use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. [Read the full article]

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Welcome to the Aetna fourth quarter 2009 earnings call. (Operator Instructions) We will begin by turn the call over to Ms. Kim Keck, Vice President of Investor Relations and Treasurers. Ms. Keck, please go ahead. Good morning and thank you for joining Aetna’s fourth quarter 2009 earnings call and webcast. This is Kim Keck, Head of Investor Relations and Treasurers for Aetna. With me this morning are Aetna’s Chairman and CEO, Ron Williams; Mark Bertolini, President; and Joe Zubretsky, Executive Vice President and Chief Financial Officer. Following their prepared remarks, we will respond to your questions. During this call, we will make forward-looking statements. Risk factors that may impact those statements and could cause actual future results to differ materially from currently expected results are described our 2008 10-K, our third quarter 2009 10-Q, as well as our 2009 10-K when filed with the SEC. [Read the full article]

Health insurer Aetna Inc. struggled with medical costs that rose faster than it expected when it set prices last year.

The Hartford, Conn., insurer said costs rose in part due to the slumping economy. It lowered its 2009 earnings outlook a couple times during the year and then set what some analysts consider to be conservative guidance for 2010.

Aetna said it expects operating earnings of $2.55 to $2.65 per share in 2010, which is lower than the $2.75 it recorded in 2009. Chief Financial Officer Joe Zubretsky discussed the outlook Friday during a conference call with analysts.

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QUESTION: How much confidence do you have in your outlook and, as you think about forecasting for this year versus last year, what are the major swing factors in your mind?

RESPONSE: I think, as we’ve said many times during 2009, it was an unusual environment. [Read the full article]

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