Health Insurance Stocks Sliding Despite Strong Q2, 2010 Forecast From Aetna

(RTTNews) - Health insurance stocks are under pressure in late-morning trading on Wednesday, contributing to the moderate pullback by the broader markets. The sector is being hurt by Aetna (AET), which is down even after its second quarter earnings, revenues and 2010 forecast beat estimates.

The weakness in the health insurance sector is reflected by the 2.2 percent loss currently being shown by Morgan Stanley Healthcare Payor Index. The index has been rangebound in recent sessions after setting a seven-month closing low set at the outset of the month.

Within the sector, Aetna is currently down by 3.1 percent, pulling back further off of Monday's one-month closing high.

The loss comes even though Aetna reported second quarter adjusted operating earnings of $0.77 per share on revenues of $8.50 billion. On average, analysts expected the company to earn $0.74 per share on revenues of $8.49 billion for the period.

For fiscal year 2010, the company boosted its operating earnings forecast to a range $3.05 to $3.15 per share from its prior guidance of $2.75 to $2.85 per share, citing improved performance in the first half of 2010. The Street is currently looking for full-year earnings of $2.99 per share.

Centene Corp. (CNC) and WellPoint Inc. (WLP) are also retreating, posting losses of 4.3 percent and 3.4 percent, respectively, pulling back further off of recent multi-week highs.

Cigna (CI), Health Net Inc. (HNT), WellCare Health Plans Inc. (WCG) and Molina Healthcare Inc. (MOH) are also under pressure, further contributing to the weakness in the sector.

by RTT Staff Writer

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