| Stock (Symbol) | Stock Price | |
Catamaran (CTRX) |
$44 |
|
| Data is as of | Expected to Report | Sector |
May 23, 2014 |
Jul 28 – Aug 1 |
Healthcare |
| Sharek’s Take | ||
 Catamaran’s paying a higher income tax rate this year, around 30% compared to around 26% last year, and that’s hurting profits. CTRX is also spending on the Catamaran Difference initiative, which includes spending on IT and customer service to try to get its client retention rate up from 95% to 98%.Income before tax is expected to be $100 million higher this year, but the company will pay $60 million more in taxes and is spending $15-$20 million on the Catamaran Difference. Revenue was $4.5 billion last qtr, well ahead of the $4.0 billion estimate, this was up 53% year over year (1st qtr with the Restat acquisition) so the company is growing and should do $20 billion in sales this year, up from $15 billion last year. CTRX should have one of the strongest PBM platforms in the business next year, but the stock is fairly valued right now. |
||
| One-Year Chart | ||
 This stock dropped when estimates got cut 2QtrsAgo, but then CTRX rebounded when it beat the street last qtr. Estimates don’t look good even though sales should grow around 50%. |
||
| Earnings Table | ||
 Revenue grew 53% last quarter, and profits increased 19%.CTRX beat by 5 cents, but this number was reduced by 8 cents a few months earlier. Still, the stock rallied when things weren’t too bad. Annual Profit Estimates stayed about the same as last quarter. Quarterly estimates got hit last quarter, and stayed consistent this quarter. |
||
| Fair Value | ||
 Without profit growth, this stock is sitting at 20 times earnings. Maybe the P/E can get to 25 next year, but I didn’t figure that in to the equation. |
||
| Ten-Year Chart | ||
 Expected profit growth of 10% this year is clearly hurting the stock. Still, CTRX seems abnormally low here when I look at the chart. |
||
| Power Ranking | Bottom Line | |
Growth Portfolio
24 of 25 |
I’ve owned this stock for many years, even through a big merger and name change. 2014’s bottom line is getting trimmed by higher taxes and expenses, but the company should be on solid ground next year. CTRX is ranked 24th of 25 stocks in the Growth Portfolio Power Rankings. Of course CTRX isn’t in the Aggressive Growth Portfolio. |
|
Aggressive Growth Portfolio
N/A |
||
