瑞银美股医疗保健行业管理式医疗所有人的HMO小心管理噪音2019422109页

GlobalResearch22April2019InitiationofCoverageManagedCareHMO'sForAll?CarefullyManagingtheNoiseAnalyzinganevolvinginvestornarrativeWeareinitiatingcoverageonthediversifiedManagedCaresector.Weseeopportunitiestobuydislocatedstocks(CignaandAnthem)thatdiscountnegativelong-termperpetuitygrowth.Emergingpoliticaluncertainty(e.g.,MedicareforAll)likelyelevatesthenear-termtail-risk,concernanddiminishesinvestorenthusiasmafteradecadeofmaterialoutperformance.Weseecurrentequitylevelspricinginmaterial30%declinestoCigna'scorePBMgrowthprofileandANTM'scurrentvaluationlooksoverlyharshrelativetoabove-average20%+EPSvisibilitythrough2020.PoliticaldebatescomplicatethebackdropFewsectorshavebenefitedasgreatlyfromgrowingUShealthcarecostsandthe2014implementationoftheAffordableCareAct(ACA).ManagedCarehasundergonerapidchangeoverthelastdecadew/significantlyenhancedclinicalcapabilities,valueandsophistication.Payershavediversifiedawayfromcommercialunderwritingrisks,repositionedw/ingrowinggov'tverticals,andhaveenjoyedrational/disciplinedpricing.UBSEvidenceLabdataunderpinsourdifferentiationUBSEvidenceLab'sEmployerBenefitSurvey(n=200+)indicatespremiumtocostspreadshavetightenedvs.prioryearsbutseemstablewithnomaterialchangeinexpectedtrend.UBSEvidenceLab'sUSHospitalDatabase(n=500-600)providesempiricalevidencethatinpatienttrendremainsfavorable.WeanalyzemonthlyBLSPPIdatatosizestableunitcosts.UBSEvidenceLab'sGlassdooranalysisranksCigna#1.UBSEvidenceLab'sTranscriptlyticsanalysisframescurrentsentiment.OurUBSMedicareAdvantageInteractiveModelisahighlyrobust,proprietaryandintensivealgorithmicdatasetwedevelopedtostudy,analyzeandforecastMAgrowth.WhatyouwilllearninthisreportWeanalyzepriorPOTUSelectioncyclesandhowsectormultiplescontractintoelectionsfollowedbymaterialoutperformanceafter.WereviewUBSEvidenceLab'sEmployerBenefitSurveyandhighlightamaterialpremiumbenefitmanagersnowassigntotheintegrationofmedical/pharmacyservices(44%citeastopreasonvs27%2yrsagosupportingBuy-ratedCigna).Weanalyzestatutoryfilingsandrisk-basedcapitaltrendstoassessemergingpricingthreatsyetseelittleevidencetomakeuscautious.ManagedCare–InitiationofCoverageSource:UBSestimatesManagedCareCompanyTickerUBSRatingCurrentPriceUBSPriceTargetUpsidetoPriceTargetUBSEPSStreetEPS%Above/BelowtheStreetUBSEPSStreetEPS%Above/BelowtheStreetCignaCorporationCIBuy149$185$24%16.46$16.48$-0.1%18.45$18.50$-0.3%AnthemIncANTMBuy240$294$23%19.50$19.16$1.8%23.24$22.78$2.0%HumanaHUMNeutral241$266$11%17.42$17.43$-0.1%18.56$19.23$-3.5%UnitedHealthGroupUNHNeutral222$238$7%14.71$14.70$0.1%16.62$16.63$[e-mail][phone]NathanLeiphardt,[e-mail][phone]InitiationofCoverage:ManagedCare22April20192CoverageUniverseOverview3SectorOverviewandOutlook4ValuationFramework11CompanyInvestmentThesisSummaries13Evidence,Tools,andAnalysis19PivotalQuestions20TableofContentsInitiationofCoverage:ManagedCare22April201933InitiatingCoverageofthe4DiversifiedManagedCareCompaniesSource:FactSet,UBSResearchCignaAnthemHumanaUnitedHealthGroupBuyBuyNeutralNeutral1.92.21.41.4totototo1111-30%-20%-10%0%10%20%30%40%50%24%23%11%7%42%46%34%29%-23%-21%-24%-21%upsidedownsideskew%differencefromcurrentpricetodownsidebasecaseupsidescenariosManagedCareCompanyTickerUBSRatingCurrentPriceUBSPriceTargetUpsidetoPriceTargetUBSEPSStreetEPS%Above/BelowtheStreetUBSEPSStreetEPS%Above/BelowtheStreetCignaCorporationCIBuy149$185$24%16.46$16.48$-0.1%18.45$18.50$-0.3%AnthemIncANTMBuy240$294$23%19.50$19.16$1.8%23.24$22.78$2.0%HumanaHUMNeutral241$266$11%17.42$17.43$-0.1%18.56$19.23$-3.5%UnitedHealthGroupUNHNeutral222$238$7%14.71$14.70$0.1%16.62$16.63$-0.1%20192020InitiationofCoverage:ManagedCare22April20194Strongfundamentaloutlookcloudedinpoliticaluncertainty.ManagedCaresectormultipleshistoricallycompressintoPOTUSelectioncyclesyetgenerallyperforminlinewiththeS&P500overandextendedperiodoftime.RhetoricanduncertaintyaroundMedicareForAll(singlepayer,publicoption,etc.)proposalselevatestail-risk,concernanddiminishesinvestorenthusiasmforoverweightexposure.Sectormultipleslikelygroundedtoa25-30%discounttotheS&P500.ForwardEPSmultipleshavecollapsed~25%inrecentmonths.Weanalyzepriorcyclesofrelativeuncertaintyviewingthe2012-13timeframeasthemostrelevant.ACArelateduncertaintydrovea25-30%sectordiscountvs.themarket(2yraverageof27%).Sectormultiplessoldaslowas8xforwardEPSw/a37%discountandashighas11.5xwitha21%discount.Sectorgrowthandrisksdifferfrompastcycles.ManagedCarehasundergonerapidchangeinthelastdecade.Payershavediversifiedawayfromcommercialunderwritingrisks,materiallyrepositionedwithingrowinggo