2 Health Care Stocks Hitting 52-Week Highs: UnitedHealth, Aetna

NEW YORK ( TheStreet) -- Shares of health care companies Aetna ( AET) and UnitedHealth Group ( UNH) hit 52-week highs on Monday.

Both stocks got buy ratings from TheStreet Ratings.

Aetna

The health care benefits company reported earlier this month fourth-quarter earnings of $372.6 million, or $1.02 a share, up from a year-ago profit of $215.6 million, or 53 cents a share.

"Overall, this was another solid quarter for the diversifieds, and we believe guidance for the group appears highly conservative given continued low utilization trends," Oppenheimer analysts wrote in a Feb. 2 report. "We believe Aetna will perform in line with the group, and we reiterate our Perform rating."

Shares of Aetna reached a 52-week high Monday of $46.50. The stock's 52-week low of $33.43 was set on Oct. 4.

Aetna has a forward price-to-earnings ratio for next year of 8.23X; the average for health care providers is 21.09X. For comparison, Express Scripts ( ESRX) and Humana ( HUM) both have higher forward P/Es of 13.77X and 9.75X respectively.

Of the 20 analysts who cover Aetna, 13 rated it a buy and seven gave it a hold rating.

TheStreet Ratings gives Aetna an A+ grade with a buy rating and has a $60.11 price target on the shares. The stock has risen 9.67% year to date.

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UnitedHealth Group

The diversified health care company completed its acquisition of XLHealth Corp. last Thursday.

UnitedHealth last month reported fourth-quarter earnings of $1.25 billion, or $1.17 a share, up from year-ago earnings of $1.04 billion, or 94 cents a share

"We believe UNH is best positioned to benefit from evolving trends on the managed care landscape," Jefferies analysts wrote in a report on Friday. "Thursday's closing of XL Health augments UNH's capabilities to serve the chronically ill. Additionally, even if individually small to the overall company, 4 goals in the last 4 shots in Medicaid (TX, LA, WA, HI) provide a collective boost to the outlook and further improve dual positioning."

Shares of UnitedHealth Group hit a 52-week high on Monday of $54.24. The stock's 52-week low of $41.27 was set on Aug. 11.

UnitedHealth has a forward P/E of 9.9X; the average for health care provider companies is 20.89X. For comparison, both Cigna ( CI) and WellPoint ( WLP) have lower forward P/Es of 7.12X and 7.6X respectively.

Of the 24 analysts who cover United Health, 20 gave the stock a buy rating. Four analysts rated it a hold.

TheStreet Ratings gives UnitedHealth an A+ grade with a buy rating and has a $68.27 price target on the shares. The stock has increased 6.27% year to date.

-- Written by Alexandra Zendrian in New York.

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