UPDATE: JP Morgan Initiates Neutral, $24 PT on Molina Healthcare on Headwinds from Medical Costs

JP Morgan initiates Molina Healthcare

with a Neutral rating and a price target of $24. JP Morgan comments, "While its position as the fifth largest Medicaid player leaves it as one of the more compelling top-line growth stories particularly given its exposure to the near-term Dual Eligible opportunity, Molina's earnings trajectory is much less clear given the headwinds from higher than expected medical costs in Texas and as well as the pace and potential of the earnings contribution from the Duals. Look for key upcoming catalysts to be visible on Texas rates and the imminent Supreme Court decision on healthcare reform." MOH closed at $22.28 on Tuesday.