Citi: WellCare Health Plans 4Q11 Initial EPS

According to a research report released today by Citi, WellCare Health Plans

was expected to guide well below the 2012 consensus, so the company's guidance will be seen as positive. In the report, Citi stated, “Operating earnings in the fourth quarter were $2.15 per share, compared with consensus of $1.18, driven by $66 million ($1.03 per share) in favorable development and a much lower tax rate ($0.19 per share). Excluding the development and the tax rate, WellCare's earnings for the quarter would have been $0.93 per share, lower than the company's guidance for earnings of $0.97-1.07 per share. A higher than normal medical loss ratio assumption for the new Kentucky contract likely contributed.” Citi maintains its Buy rating and $70 PT on WellCare Health Plans, which closed yesterday at $62.96.