Equity Insights June 7th: Molina Healthcare, Centene, Precision Castparts, Las Vegas Sands, Wynn Resorts
Molina Healthcare Inc. (NYSE:MOH): Citigroup lowered its price target for Molina Healthcare (NYSE:MOH) after the company withdrew its earnings guidance due to medical cost pressure in Texas, but says investors should not overreact to the news. Citi notes that troubled Medicaid markets have shown the ability to turn around in a couple of quarters in the past. The firm believes the news from Molina last night could weigh on Amerigroup (NYSE:AGP) and Centene (NYSE:CNC), as both have exposure to Texas.
Centene Corp. (NYSE:CNC): After Molina Healthcare (NYSE:MOH) withdrew its earnings guidance due to cost issues in Texas, Jefferies points out that Centene (NYSE:CNC), Cigna (NYSE:CI) and Amerigroup (NYSE:AGP) have a presence in same service areas as Molina. However, the firm adds that their Texas exposures are much smaller than Molina’s and that Molina’s issues could prove to be company specific. Jefferies says Centene has the closest exposure to Molina with 27K lives in the Texas service areas, followed by Cigna with 15k and Amerigroup with 11k.
Precision Castparts Corp. (NYSE:PCP): After touring a Precision Cast facility and meeting with the head of the company’s Forged Products unit, RBC Capital is confident that the company’s key end markets are on track. The firm maintains a $204 target and Top Pick rating on the stock.
Las Vegas Sands Corp. (NYSE:LVS): BMO Capital sees several positive catalysts for Las Vegas Sands, including strong metrics in Singapore and steady growth in Macau. The firm expects the company to be able to continue to grow at the fastest rate among gaming companies and it maintains an Outperform rating on the stock.
Wynn Resorts Ltd. (NASDAQ:WYNN): UBS lowered price targets on Wynn Resorts (NASDAQ:WYNN) to $147 from $165, Las Vegas Sands (NYSE:LVS) to $56 from $64, and MGM Resorts (NYSE:MGM) to $12 from $14 due to lower visibility and concerns revenue growth could disappoint this summer.
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