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Wellpoint Third Quarter Earnings
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WLP
Wellpoint (NYSE:WLP) announced its results for the most recent quarter on November 7, 2012. WellPoint is a health benefits company which offers a spectrum of network-based managed care plans to employers, individuals, and seniors.
Earnings are perhaps the single most studied number in a company's financial statements because they show a company's profitability. SEE: 12 Things You Need To Know About Financial Statements
The Numbers: Wellpoint's latest numbers were good, as the company announced EPS and revenues that came in ahead predictions. The company reported adjusted net income of $7.40 per share versus the $2.05 per share estimate and revenues of $15.35 billion versus the $15.27 billion estimate. Revenue fell 0.3% from the same period last year. Slumping revenue in the last quarter ends Wellpoint's streak of four consecutive quarters of revenue increases. Wellpoint's net income for the third quarter was $691.2 million, a 1.2% increase from last year. After posting a profit last quarter, the company breaks a streak of four consecutive quarters of year-over-year profit drops.
Management Quote: "Our third quarter results compared favorably to our expectations and reflected more consistent execution across our businesses. We are preparing for a successful Amerigroup integration and have recently taken steps to better align business level leadership to execute on the growth opportunities before us," said John Cannon, interim president and chief executive officer.
A Look Back: Net income has dropped 12.2% year-over-year on average across the last five quarters. Performance was hurt by a 38.9% decline in the fourth quarter of the last fiscal year from the year-earlier quarter.
Looking Ahead: Expectations for the company's next-quarter results are lower than they have been. Over the past 60 days, the average estimate for fourth quarter has fallen from $2.02 per share to $2.01. When analyst increase earnings estimates investors can assume business has been stronger than first thought and is an encouraging sign for investors. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. In the past month, the average estimate for the fiscal year has fallen from $7.77 per share to $7.73.
Earnings are perhaps the single most studied number in a company's financial statements because they show a company's profitability. SEE: 12 Things You Need To Know About Financial Statements
The Numbers: Wellpoint's latest numbers were good, as the company announced EPS and revenues that came in ahead predictions. The company reported adjusted net income of $7.40 per share versus the $2.05 per share estimate and revenues of $15.35 billion versus the $15.27 billion estimate. Revenue fell 0.3% from the same period last year. Slumping revenue in the last quarter ends Wellpoint's streak of four consecutive quarters of revenue increases. Wellpoint's net income for the third quarter was $691.2 million, a 1.2% increase from last year. After posting a profit last quarter, the company breaks a streak of four consecutive quarters of year-over-year profit drops.
Management Quote: "Our third quarter results compared favorably to our expectations and reflected more consistent execution across our businesses. We are preparing for a successful Amerigroup integration and have recently taken steps to better align business level leadership to execute on the growth opportunities before us," said John Cannon, interim president and chief executive officer.
A Look Back: Net income has dropped 12.2% year-over-year on average across the last five quarters. Performance was hurt by a 38.9% decline in the fourth quarter of the last fiscal year from the year-earlier quarter.
Looking Ahead: Expectations for the company's next-quarter results are lower than they have been. Over the past 60 days, the average estimate for fourth quarter has fallen from $2.02 per share to $2.01. When analyst increase earnings estimates investors can assume business has been stronger than first thought and is an encouraging sign for investors. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. In the past month, the average estimate for the fiscal year has fallen from $7.77 per share to $7.73.
by
Investopedia Staff
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