Health Net Inc (HNT): Today's Featured Health Care Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Health Net ( HNT) pushed the Health Care sector lower today making it today's featured Health Care laggard. The sector as a whole closed the day up 0.5%. By the end of trading, Health Net fell 36 cents (-1.6%) to $22.77 on light volume. Throughout the day, 566,462 shares of Health Net exchanged hands as compared to its average daily volume of 1.7 million shares. The stock ranged in price between $22.65-$23.25 after having opened the day at $22.74 as compared to the previous trading day's close of $23.13. Other companies within the Health Care sector that declined today were: Isis Pharmaceuticals ( ISIS), down 21.9%, Somaxon Pharmaceuticals ( SOMX), down 11.6%, Prima Biomed ( PBMD), down 10.9%, and Idera Pharmaceuticals ( IDRA), down 9%.
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Health Net, Inc., through its subsidiaries, provides managed health care services. Health Net has a market cap of $1.88 billion and is part of the health services industry. The company has a P/E ratio of 19.4, above the average health services industry P/E ratio of 9.1 and above the S&P 500 P/E ratio of 17.7. Shares are down 24% year to date as of the close of trading on Monday. Currently there are no analysts that rate Health Net a buy, five analysts rate it a sell, and nine rate it a hold.

TheStreet Ratings rates Health Net as a hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, poor profit margins and feeble growth in the company's earnings per share.

On the positive front, Ampio Pharmaceuticals ( AMPE), up 11.5%, Aegerion Pharmaceuticals ( AEGR), up 9.7%, Dynatronics Corporation ( DYNT), up 9.6%, and KYTHERA Biopharmaceuticals ( KYTH), up 8.4%, were all gainers within the health care sector with Gilead ( GILD) being today's featured health care sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the health care sector could consider Health Care Select Sector SPDR ( XLV) while those bearish on the health care sector could consider ProShares Ultra Short Health Care ( RXD).

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