UPDATE: JP Morgan Initiates Humana with Neutral, $89 PT on Medicare Regulation Uncertainty
JP Morgan initiates its coverage on Humana (NYSE: HUM) with a Neutral rating and a price target of $89.
JP Morgan notes, "Given the company's outsized exposure to Medicare Advantage, our view here is constructive on the near term operating performance and potential long term opportunity offset by what we expect to be decreasing regulatory/oversight visibility post elections and focus possibly shifting to the uncertain impact of 2014 reform implementation. We believe the bull case is that the margin expectations are now more reasonable post Q1 results, privatization of Medicare is inevitable and this company maybe more than any other would benefit from a Republican shift, leaving optionality into elections."
HUM closed at $78.74 on Tuesday.
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