NEW YORK (TheStreet) -- Shares of Aetna (AET) are higher by 2.46% to $124 in pre-market trading on Tuesday morning, following a report from The Wall Street Journal that UnitedHealth Group (UNH) approached the health insurer regarding a takeover deal that could value Aetna at over $40 billion.
UnitedHealth approached Aetna via a letter within the past few days, sources told The Journal, adding it was unclear what, if any, response was given.
Aetna and other insurers are said to be considering buying Humana (HUM). The Journal reported in May that Humana is looking into strategic alternatives, which includes the possibility of a sale.
Some companies within the health insurance sector are in the process of merger talks as they try to keep up with changes in the industry that will allow them to cut costs.
"They are all trying to figure out how five becomes three. We don't know which is merging with which but that seems to be the goal. Terrible for the consumer but will the government even realize it?" TheStreet's Jim Cramer, Portfolio Manager of the Action Alerts PLUS charitable trust portfolio said.
Separately, TheStreet Ratings team rates AETNA INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate AETNA INC (AET) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, revenue growth and attractive valuation levels. We feel its strengths outweigh the fact that the company shows low profit margins."