Coventry Health Care Inc. Earnings: Weak Revenue Lead to Profit Decline

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S&P 500 (NYSE:SPY) component Coventry Health Care Inc. (NYSE:CVH) posted a decrease in profit as revenue declined. 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 Fourth Quarter

Results: Net income for the health care plans company fell to $85.7 million (60 cents per share) vs. $150.3 million ($1.01 per share) a year earlier. This is a decline of 43% from the year earlier quarter.

Revenue: Fell to $3.13 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: Coventry Health Care Inc. reported adjusted net income of 58 cents per share. By that measure, the company fell short of mean estimate of 64 cents per share. Analysts were expecting revenue of $3.09 billion.

Quoting Management: “We spent much of 2011 focused on seizing growth opportunities for 2012 and beyond, and I am very pleased with the strong growth in Medicaid and Medicare as we enter the first quarter of 2012,” said Allen F. Wise, chairman and chief executive officer of Coventry. “As we wrap up 2011, we turn our focus towards 2012 with a forecast of double digit revenue growth coupled with operating earnings and EPS growth. We are hard at work to deliver on 2012 commitments while laying the foundation to seize opportunities for the future.”

Key Stats:

The company fell short of forecasts after beating estimates in the previous two quarters. In the third quarter, it topped the mark by 3 cents, and in the second quarter, it was ahead by 7 cents.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the first quarter of the next fiscal year is 66 cents per share, down from 67 cents ninety days ago. The average estimate for the fiscal year is now $2.93 per share, down from $2.94 sixty days ago.

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

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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