Health Net Shares Rally Following Susquehanna Upgrade, Says Co. Set to Capitalize on SoCal Market

Shares of Health Net HNT have surged more than 4 percent Monday following an early-morning upgrade from Susquehanna's Chris Rigg. The stock last traded at $30.96. Volume is on the heavier side of things heading into the last couple hours of trade. Rigg now rates Health Net shares at Positive, up from Neutral previously. The analyst boosted his price target on the stock from $35 to $40. The Susquehanna analyst's raised investment rating is based on his model for Health Net's earnings power to be around $4 per share by 2015. Rigg believes Health Net could be touting a 50 percent surge in company sales over the next two to four years. He sees the company positioned to capitalize from the expansion of ACA coverage and dual eligibility in California. Rigg is assuming Health Net could gain as many as 300,000 new members in Southern California alone.