NEW YORK (
) -- The Supreme Court will announce its decision on the constitutionality of Obamacare Thursday.
In case you don't remember, the real name of the bill is "Patient Protection and Affordable Care Act." From different surveys I have read, it appears there's a 75% chance that the individual health care mandate in the act will be ruled unconstitutional.
ValuEngine shows that the Medical Sector is 7.4% overvalued, but within that sector, the Health Maintenance Organizations Industry is 5.6% undervalued.
I will evaluate the price performance of nine stocks in this industry focusing on the volatility since March 26, when the Supreme Court began deliberating on Obamacare.
All nine of the stocks I profile are rated Strong Buy or Buy according to ValuEngine, and all but one traded lower during the period of deliberation by the Supreme Court. Those that have moved lower have been hurt by the general uncertainty about the outcome, and may have higher costs to adjust to the outcome.
Here's a table of information from
include my value levels, pivots and risky levels.
Definitions of the Columns
OV/UN Valued: Red is the percent undervalued. Black is the percent overvalued. The most undervalued stock is
, at 23.5% undervalued. The most overvalued is
( CVH), at 14.6% overvalued.
VE Rating: 5-Engine is Strong Buy. 4-Engine is Buy. The Strong Buys are
Last 12-Month Return (%): Red is negative. Black is positive. UNH is the only stock on the list to post a price rise over the past twelve months with a 17.8% gain.
Forecast One-Year Return: Since they are all rated Buy or better, the upside projection is in black. Those with a projected gain of 12% or more garner the 5-Engine, Strong Buy rating.
P/E Ratios: The price-to-earnings ratios range from 7.1 to 22.4.
Value Level: The price at which to enter a good 'til canceled limit order to buy on weakness (W-Weekly, M-Monthly, Q-Quarterly, S-Semiannual and A- Annual)
Pivot: A level between a value level and risky level that should be a magnet during the time frame noted.
Risky Level: The price at which to enter a GTC Limit Order to sell on strength.
Aetna ($40.96) traded down from $51.14 on March 30 to $39.07 on May 18. The stock is below its 50-day and 200-day simple moving averages at $42.62 and $42.65, respectively.
( AGP) ($62.40) traded down from $75.18 on Feb. 17 to $56.41 on June 12. The stock is just below its 50-day simple moving average at $62.43 with the 200-day simple moving average at $59.70.
($29.91) traded down from $50.98 on April 5 to $24.26 on June 11. The stock is below its 50-day and 200-day simple moving averages at $35.77 and $38.64, respectively.
Coventry Healthcare ($33.23) traded down from $36.04 on March 30 to $27.72 on April 27. This stock has recovered off its low and is now above its 50-day and 200-day simple moving averages at $31.50 and $31.38, respectively.
Health Net ($25.17) traded down from $41.22 on April 5 to just above $24.00 since June 7. The stock is below its 50-day and 200-day simple moving averages at $27.98 and $31.13, respectively.
($79.54) traded down from $96.46 on Jan. 17th to $73.71 on May 21. The stock is below its 50-day and 200-day simple moving averages at $80.24 and $83.96, respectively.
UnitedHealth Group ($59.29) traded up from $49.82 on Jan. 25 to $60.75 on June 19. The stock is above its 50-day simple moving average at $57.00 and 200-day simple moving average at $52.44.
Wellcare Health ($49.61) traded down from $74.41 on April 5 to $49.16 on June 19. The stock is below its 50-day and 200-day simple moving averages at $57.50 and $56.57, respectively.
Wellpoint Inc. ($69.49) has not declined on concerns about Obamacare, and set a trading range between $63.34 on March 13 and $74.73 on March 30. The stock is in the midst of this range, above its 50-day and 200-day simple moving averages at $68.19 and $67.47, respectively.
I have no positions in the stocks mentioned today, and no other conflicts.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.