Financial Advisor Update

Five Large-Cap Stocks Set to Gain

Stock quotes in this article: MHS , IBM , CL , DTV , MCD  

BOSTON (TheStreet) -- Economic worries could spur investors to seek out blue-chip stocks this quarter. These companies would benefit from that trend.

5. Medco Health Solutions(MHS Quote) is a pharmacy benefit manager.

The numbers: Third-quarter net income increased 13% to $336 million and earnings per share climbed 19% to 69 cents, boosted by a lower share count. Revenue grew 18% to $15 billion. Medco's gross margin remained steady at 7% and its operating margin was unchanged at 4%. A quick ratio of 1 reflects adequate liquidity. A debt-to-equity ratio of 0.7 indicates reasonable leverage.

The stock: Medco has advanced 46% this year, more than major U.S. indices. The stock trades at a price-to-earnings ratio of 25, a premium to the market and health care service peers. Medco doesn't pay dividends.

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