WellCare Shares Jumped: 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 Medicaid and Medicare coverage provider WellCare Health Plans (NYS: WCG) popped 12% on Wednesday after the company's quarterly results and full-year outlook topped analyst expectations.

So what: WellCare's big fourth-quarter beat -- EPS of $1.96 versus the consensus of $1.19 -- clearly indicates that the growth in health-care use continues to be relatively slow. The stock is even hitting a new 52-week high on the news, suggesting that Wall Street fully expects that trend to continue.

Now what: Looking ahead, management expects 2012 adjusted EPS of $4.40-$4.60, well ahead of Wall Street's $4.20 estimate. "In many ways, our achievements during 2011 transformed the Company and positioned us well for the future," CEO Alec Cunningham said. However, with the stock now up about 100% over the past year, much of that optimism might be baked well into the price.

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At the time thisarticle was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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