Investors had clearly hoped for a stronger outlook from Coventry Health ( CVH).

They ignored Coventry's solid third-quarter results and instead hammered the stock on news of lower guidance. The shares tumbled 10% to $54 following Tuesday's quarterly update.

To be fair, Coventry reported solid third-quarter results with help from an expanded membership base. Following its big merger with First Health, Coventry managed to boost revenue by 26% to $1.67 billion -- just shy of the $1.69 billion consensus estimate -- and match Wall Street's earnings expectations with profits of 81 cents a share. Net income rocketed 53% to $133 million during the period.

Looking ahead, however, Coventry has warned that Hurricane Katrina could bring some future pain. Coventry derives 3.4% of its revenue from Louisiana, where it serves 76,000 customers -- the bulk of them in the greater New Orleans area. The company managed to escape the third quarter without a storm-related hit. However, it expects the hurricane to lower profits by as much as 5 cents a share in both the fourth quarter and the coming year.

For 2006, Coventry now expects to post 2006 earnings of between $3.54 and $3.59 a share. Even with a projected 2-cent boost from Medicare opportunities, that total would fall shy of the current $3.64 consensus estimate.

Analysts seemed a bit unfazed, however. Charles Boorady of Citigroup called Coventry's disappointing guidance "typical" for the company. And John Rex of Bear Stearns recommended buying the stock on any pressure Tuesday.

"We believe that core operating fundamentals remain quite favorable," Rex wrote on Tuesday. And "we think there could be a near-term opportunity if (the) stock is weak on 2006 guidance points."

Boorady, who also recommends buying the stock, continues to maintain his $68 target price on the shares.

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