Health Net Profit Surges On Revenue, Benefit; Stock Up - Update

(RTTNews) - Health Net Inc (HNT) Wednesday reported a surge in second-quarter profit, helped by a 25 percent jump in revenue, with growth in Western region operations and government contracts segments. Results also reflect one-time tax benefit.

The company reiterated its guidance for 2014.

Following the announcement, Health Net shares gained more than 5 percent in morning trade on the New York Stock Exchange.

Health Net provides managed health care services through health plans and government-sponsored managed care plans.

The Woodland Hills, California-based company posted quarterly net income of $120.9 million or $1.49 per share, compared with $33.5 million or $0.42 per share last year.

Results for the quarter included $72.6 million tax benefit from a loss on the stock of a subsidiary.

On average, 14 analysts polled by Thomson Reuters expected earnings of $0.56 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter rose to $3.42 billion from $2.74 billion a year ago, and topped analysts' expectations of $3.40 billion.

The company achieved 17.4 percent enrollment growth in its Western region health plans.

For full year 2014, Health Net continues to expect net income of at least $3.00 per share and revenues of $14 billion. Analysts expect earn $2.28 per share on revenues of $14.09 billion. Health Net stock is trading at $43.93, up $2.21 or 5.30%, on a volume of 1 million shares.