Universal American Shares Popped: What You Need to Know
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 health-care benefit provider Universal American (NYS: UAM) were looking quite healthy today, gaining as much as 11% in intraday trading on heavier-than-average volume.
So what: Most big stock moves right now are all about earnings reports, and Universal American's jump is certainly in that camp. The sale of the company's Medicare Part D business to CVS Caremark (NYS: CVS) muddied up the company's results, but after backing out the impact of the sale, the bottom line topped Wall Street's estimates. Analysts had expected that the company would report adjusted earnings of $0.01 for the quarter, but Universal soared over that, revealing a $0.10 adjusted per-share profit for the quarter.
Now what: There will continue to be extra work for investors to do in the quarters to come as the impact from the segment sale hangs around on the profit and loss statement. In addition, debt ceiling deal or not, the government's budget will continue to be in the spotlight, which means that companies that depend on payments from Uncle Sam may have reason to chew their nails.
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