Aetna, Allstate May Be Portfolio Insurance

Banc of America Securities boosted its investment ratings on two insurance companies this week, saying each has shown improvement relative to its peers.

Aetna's (AET Quote) nearly complete turnaround and expected low medical costs are helping the company build market share, said Banc of America Securities analyst Joseph France, who upgraded the company to buy from neutral Monday.

France expects Aetna to increase enrollment in the second half of this year, as a result of its recent restructuring, recontracting with providers and focus on medical management. The company also has an advantage in several markets because its medical cost trends appear to be hundreds of basis points lower than the industry average, France said. ...