Coventry Health Care Inc. Earnings: Revenue and Net Income Grow

S&P 500 (NYSE:SPY) component Coventry Health Care Inc. (NYSE:CVH) reported higher profit for the first quarter as revenue showed growth. Coventry Health Care operates health plans, insurance companies, network rental, and workers’ compensation services companies.

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Coventry Health Care Earnings Cheat Sheet for the First Quarter

Results: Net income for Coventry Health Care Inc. rose to $170.7 million ($1.20 per share) vs. $110.2 million (73 cents per share) in the same quarter a year earlier. This marks a rise of 54.9% from the year-earlier quarter.

Revenue: Rose 21.1% to $3.69 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Coventry Health Care Inc. reported adjusted net income of 62 cents per share. By that measure, the company fell short of mean estimate of 63 cents per share. It beat the average revenue estimate of $3.49 billion.

Quoting Management: “Today we reported a strong start to 2012 with six of our seven core businesses performing either at or above our expectations in the quarter,” said Allen F. Wise, chairman and chief executive officer of Coventry. “For example, I am very pleased with the Medicare growth and financial performance in the quarter, now representing approximately $4.3 billion of annual revenue, or 30% of the Company’s total revenue. We are optimistic about the future and our positioning to seize opportunities across our diversified businesses.”

Key Stats:

Last quarter’s profit increase breaks a streak of two consecutive quarters of year-over-year profit decreases. Net income fell 43% in the fourth quarter of the last fiscal year and in the third quarter of the last fiscal year.

The company has fallen short of estimates for two consecutive quarters. In the fourth quarter of the last fiscal year, it missed expectations by 6 cents with net income of 58 cents versus a mean estimate of net income of 64 cents per share.

Looking Forward: Over the past ninety days, the average estimate for the second quarter has fallen from 83 cents per share to 82 cents, indicating that analysts are growing pessisimistic about the company’s performance next quarter. The average estimate for the fiscal year is $3.25 per share, down from $3.28 ninety days ago.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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