4-Star Stocks Poised to Pop: WellPoint

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Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, health insurer WellPoint (NYS: WLP) has earned a respected four-star ranking.

With that in mind, let's take a closer look at WellPoint's business and see what CAPS investors are saying about the stock right now.

WellPoint facts

Headquarters (Founded)Indianapolis (1944)
Market Cap$22.9 billion
IndustryManaged health care
Trailing-12-Month Revenue$59.3 billion
ManagementCEO Angela Braly (since 2007)
CFO Wayne DeVeydt (since 2007)
Return on Equity (Average, Past 3 Years)15.1%
Cash/Debt$19.56 billion / $9.66 billion
Dividend Yield1.6%
Competitors

Aetna (NYS: AET)

CIGNA (NYS: CI)

UnitedHealth (NYS: UNH)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 94% of the 933 members who have rated WellPoint believe the stock will outperform the S&P 500 going forward. These bulls include pchop123 and fellow Fool Sean Williams (TMFUltraLong), the seventh-ranked stock picker in all of CAPS.

Late last month, pchop123 touched on several of WellPoint's positives:

Moving up especially as people continue & rightfully so, continue to slam Obamacare. Some yield & attractive PE. Stock could jump as much as 50% over the next year on favorable developments.

In fact, WellPoint currently trades a rather paltry EV/EBITDA multiple of 2.4. That represents a clear discount to competitors like Aetna (4.7), CIGNA (5.2), and UnitedHealth (5.4).

Sean elaborates on the UnitedHealth bull case:

Best run health benefits company out there. Almost half of the company's value is tied up in net cash, the other comes from its extremely strong cash flow. Very profitable, [traded] well below book value and at just 7 times forward earnings. Looks good to me.

What do you think about WellPoint, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to track WellPoint?Add it to your watchlist.

At the time this article was published Fool contributorBrian Pacamparaowns no position in any of the companies mentioned.Motley Fool newsletter serviceshave recommended buying shares of WellPoint and UnitedHealth.Motley Fool newsletter serviceshave recommended creating a diagonal call position in UnitedHealth, and the Fool owns shares of it. Try any of our Foolish newsletter servicesfree for 30 daysWe Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Fool'sdisclosure policyalways gets a perfect score.

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