Jefferies Maintains Hold, $29 PT on Health Net

Jefferies reiterates its Hold rating and $29 target price on Health Net

as the company sells PDP business for seemingly low price. Jefferies says, "HNT's sale of its Medicare PDP business (4% of revenue) to CVS Caremark is on the low end of other recent industry transactions. PDP was a source of earnings headwind in 2011, as sanctions caused about a 12% membership decline and MLRs were higher than expected. Nonetheless, PDP seemed ready to rebound in 2012, and we question whether HNT is getting enough consideration." HNT closed at $32.78 per share on Monday.