Morgan Stanley Reiterates "Overweight" On UnitedHealth
November 22, 2011 1:20 PM
UnitedHealth (NYSE: UNH) has earned more praise for its acquisition of privately held XL Health, a deal that will boost the company's exposure to special needs plans. Oppenheimer was bullish on the deal in a note published today and Morgan Stanley is as well.
Morgan Stanley reiterated an “overweight” rating on UnitedHealth, saying “the deal makes sense to us and continues the M&A trend emerging in managed care, which we expect to continue for Medicare and commercial assets.”
The bank noted that in addition to UnitedHealth, rivals Aetna (NYSE: AET) and WellPoint (NYSE: WLP) were also interested in XL Health and the end result is something of a “missed opportunity” for Aetna.
Morgan Stanley said the deal could add to UnitedHealth's earnings next year.
