Deutsche Bank Maintains Hold on Universal American After Acquisition Announcement

Deutsche Bank has published a research report on Universal American

after the company announced its plans to acquire privately-owned APS Healthcare this morning. In the report, Deutsche Bank writes, "UAM announced today that it has agreed to acquire APS Healthcare, a private specialty managed care company for $227.5 million. We view this is an interesting acquisition for UAM that should bolster the company's care management capabilities. However, the deal will diversify UAM's business profile away somewhat from Medicare, as APS has a customer profile that is more concentrated in the Commercial and Medicaid markets. From a public market perspective, we would view Magellan Health (MGLN-BUY- $49.85) as being one of the closest comps to APS." Deutsche Bank maintains its Hold rating and $11 price target on Universal American, which is currently trading down $1.10 from yesterday's $13.54 closing price.