Citigroup Reiterates Buy Rating, $58 PT on Magellan Health Services

In a report published Monday, Citigroup reiterated its Buy rating and $58.00 price target on Magellan Health Services

. Citigroup noted, “On Monday, Magellan announced the loss of its contract with Horizon Blue Cross Blue Shield in New Jersey. We estimate this contract will generate $193 million in revenue in 2012, and assuming an average segment margin, around $30 million in EBITDA, or $0.65 per share. The current contract doesn't end until December 31, 2013, so Magellan's earnings won't be pressured until 2014.” Magellan Health Services closed on Friday at $49.79.