UPDATE: BMO Capital Raises PT on Catamaran Corp. on 4Q12 Results, FY2013 Guidance

In a report published Friday, BMO Capital Markets reiterated its Market Perform rating on Catamaran Corp. CTRX, and raised its price target from $50.00 to $59.00. BMO Capital Markets noted, “Fourth quarter results were solid and FY2013 guidance was well within bounds of the Street view. Script growth outpaced our model and synergies from the Catalyst deal were captured ahead of schedule. There was some chatter around sales growth expectations but we suspect shares dragged today as a result of commentary around the Cigna contract (up for renewal on Jan 1, 2014). We continue to believe that Catamaran would be a good strategic fit for Cigna. However, if the low-margin health plan business were to roll off, headline risk is likely larger than the impact to 2014 earnings potential. Current owners should continue to hold the shares in our view as this binary overhang is likely short lived. New money should wait for a better entry point given the contract's limbo status and a nearing verdict.” Catamaran Corp. closed on Thursday at $53.75.