Back to top

Image: Bigstock

Anthem (ANTM) Inks Deal to Acquire Beacon Health Options

Read MoreHide Full Article

Anthem, Inc. (ANTM - Free Report) has agreed to purchase Beacon Health Options, the largest independent behavioral health organization in the country. The buyout is expected to close in the fourth quarter of 2019, subject to closing conditions. However, financial terms of the buyout were not disclosed.

The transaction perfectly complements Anthem’s solid strategy to foray into health services and provide advanced integrated services and care delivery models that dispense tailor-made care for patients, who suffer chronic conditions.

Notably, Beacon, that presently caters to more than 36 million individuals across all 50 states, is the perfect partner to help Anthem boost its capabilities, which in turn, would enable it to cater to the evolving needs of state partners, health plans and employer groups.

The combination of Anthems’ current behavioral health business with Beacon’s successful model will enable the companies to enhance their care and improve health outcomes of patients. This is supported by a robust portfolio of specialized products, better clinical expertise, improved analytics and health data plus a wider range of networks and relationships. This unique integration will also lead to one of the most comprehensive behavioral health networks.

On closure of this deal, Beacon will work as a team included in Anthem’s Diversified Business Group. This strategic move is expected to be marginally accretive to the company’s adjusted earnings in 2020.

Anthem has been actively collaborating and acquiring companies for enhancing its expansion process over the past many years. Acquisitions have always helped the company drive its Medicare Advantage growth as well as add to its business portfolio. The company has also launched successful partnerships with various organizations recently and it expects its collaboration model to accelerate growth. We expect all these initiatives to continue to augur well for the company’s growth.

Shares of this Zacks Rank #3 (Hold) company have rallied 21.5% in a year’s time against its industry’s slip of 2%.


Stocks to Consider

Investors interested in the medical sector can take a look at some better-ranked stocks like HCA Healthcare, Inc. (HCA - Free Report) , WellCare Health Plans, Inc. (WCG - Free Report) and Molina Healthcare, Inc (MOH - Free Report) . You can see the complete list of today’s Zacks #1 Rank stocks here.

HCA provides health care services. In the last four quarters, the company delivered average beat of 15.74%. It carries a Zacks Rank #2 (Buy).

WellCare Health offers managed care services to government-sponsored health care programs. The company has a Zacks Rank of 2 and pulled off average positive surprise of 13.52% in the preceding four quarters.

Molina offers Medicaid-related solutions to meet the health care needs of low-income families and individuals. In the trailing four quarters, the company delivered average beat of 88.17%. It sports a Zacks Rank #1 (Strong Buy).

More Stock News: This Is Bigger than the iPhone!

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.

Click here for the 6 trades >>