Peer Competition:

The market is the final say, and although Tenet was up 28% in the past year, United Healthcare Group ( UNH) was up only 8%, WellPoint ( WLP) was down 16% and Cigna ( CI) was up 21%:

United Healthcare has a financial strength rating of A+ and is rated by TheStreet as an A- stock. Revenue is projected to be up 8.7% next year, and earnings are expected to increase annually by 10.48% for the next five years.

WellPoint has a financial strength of A and is rated as a B by TheStreet. Revenue is expected to increase by 8.2% next year, and earnings should increase by 8.29% annually for the next five years.

Cigna has a financial strength of B++ and TheStreet gives the stock and A rating. Revenue might be up 10.2% next year, and earnings are estimated to increase by 10.21% annually for five years.

Conclusion: With risk comes return, and I look for Tenet to benefit from Obamacare. Analysts expect the earnings to compound by 11.73% annually for the next five years and also expect the annual total return to investors to be in the 25%-30% range for that same period. The stock has gotten good support since July, and the lower 14-day turtle channel shows nice steady increases in that support as is evidenced in the chart below. If you want an Obamacare play, I think you'll find it here.

At the time of publication, VanMeerten held no positions in Tenet Healthcare, but the stock was on his new-purchase watch list.

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