| Stock (Symbol) | Stock Price | |
Catamaran (CTRX) |
$51 |
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| Data is as of | Expected to Report | Sector |
May 20, 2013 |
Jul 29 – Aug 2 |
Healthcare |
| Sharek’s Take | ||
 Catamaran (CTRX) has a cloud hanging over it. The company may lose its HealthSpring business, which accounted for around $3 billion in revenue last year. Catamaran has a contract with Medicare provider HealthSpring, which was bought by Cigna last year. Cigna might choose to not renew the contract and instead keep the business in-house and do it itself. Last year, Catalyst Health Solutions (CHSI) and SXC Health Solutions (SXCI) merged to make Catamaran (CTRX), and now the combined entity is expected to do $14 billion in sales. So losing $3 billion in business wouldn’t be devistating, but would it would still certainly hurt profits. |
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| One-Year Chart | ||
 This stock’s settled down after going on a tear in 2012. Profit growth remains robust and Estimates look fantastic. A P/E of 27 is low, CTRX had a P/E of 44 in 2012 Q3. 2013 profits are set to grow 55% year-over-year. This part of the story looks great. |
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| Earnings Table | ||
 Profits jumped 62% last quarter. Sales increased 88% but that’s skewed because of the Catalyst merger.CTRX beat only a penny last quarter. Annual estimates stayed consistent with last quarter. Quarterly estimates show 30% growth ahead even three and four quarters out. 30% growth is why I feel the stock deserves a P/E of 35. |
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| Fair Value | ||
 This stock has solid upside to its Fair Value. Check out the ten-year chart, this company grows rapidly. |
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| Ten-Year Chart | ||
 Most of this ten-year chart the history of SXCI, before the merger with CHSI. Catamaran will continue to acquire other companies so I feel the estimated long term growth rate of 20% is low. This could continue to be a 30% grower. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
7 of 14 |
The Cigna deal is the cloud that hangs over this stock. If the two sides agree to continue doing business, CTRX could soar. If it losses this business estimates and the stock will likely get cut. If you’re a long-term investor, buy here. CTRX is ranked 7 of 14 in the Growth Portfolio Power Rankings. With the Cigna clouds I feel this stock has too much short-term risk for the Aggressive Growth Portfolio. |
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Aggressive Growth Portfolio
N/A |
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