Humana Rises After Winning Military Contract

[Stocks-to-Watch]

Shares of health insurer Humana (HUM) rose 4% on Monday after the Department of Defense announced late Friday that it had awarded a major contract to the company. Humana successfully challenged a decision by the DoD in 2009 to award the Tricare South Region contract to UnitedHealth Group (UNH).

“Under terms of the award, Humana Military will continue supporting the DoD’s delivery of health care services to three million active duty and retired service members and their families in Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, Oklahoma, South Carolina, Tennessee and most of Texas,” the company announced. The company raised its 2011 guidance to a range of $5.95 to $6.15, and a handful of analysts upgraded the stock.

“[The] stock� has �significantly �underperformed �peers� since �October, �and we� think� investors� should� buy� on� compelling� valuation,” wrote Jefferies analyst David Windley.



Original Article Source by Barrons.com