NEW YORK (TheStreet) -- Shares of Centene (CNC) - Get Report are tumbling 9.85% to $67.85 on heavy trading volume Tuesday morning even though the company posted higher-than-expected results for the 2016 second quarter.
Before today's market open, the St. Louis-based healthcare company reported adjusted earnings of $1.29 per share, topping analysts' estimates of $1.09 per share.
Revenue for the quarter was $10.9 billion, above Wall Street's projections of $10.79 billion.
Results were helped by the company's acquisition of rival Health Net.
CEO Michael Neidorff said on the company's earnings call that Centene has not participated and will not participate in bidding and auctions, Fortune reports.
Last week, the Justice Departmentsued to block Aetna's (AET) proposed purchase of Humana (HUM) and the proposed deal between Anthem (ANTM) and Cigna (CI).
This led to speculation that Centene was interested in bidding for any potential divestures that could come from the companies trying to win regulatory approval for their mergers, Fortune noted.
For 2016, Centene forecasts earnings per share between $4.20 and $4.55 on revenue of $39.4 billion to $40 billion. Analysts are looking for earnings of $4.21 per share on revenue of $39.71 billion.
About 5.07 million of the company's shares changed hands so far today compared to its average volume of 1.74 million shares per day.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B on the stock.
The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year.
The team believes its strengths outweigh the fact that the company has had sub par growth in net income.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: CNC