Earnings Preview: Wellpoint

Wellpoint (WLP) is expected to report Q2 earnings before market open Wednesday July 23, with a conference call scheduled for 8:30 am ET.

Guidance

Analysts are expecting a profit of $1.36 on revenue of $15.61B. The consensus range for EPS is $1.30 to $1.44 with a revenue range $15.26B to $16.05B, according to First Call. Wellpoint reported Q1 EPS $1.07 vs. consensus of $1.19 and reported Q1 revenue $15.55B vs. consensus of $15.43B. On July 11, the company reaffirmed FY08 EPS guidance of $5.42 to $5.67 vs. consensus of $5.47.

Analyst Views

Positives for this quarter include higher Medicaid enrollments and gains in national accounts. A significant negative driver for this quarter will be the company's loss of the New York State pharmacy benefit management contract. On June 13, Citigroup said there have been investor concerns that Wellpoint may back off guidance. The firm spoke with the company and said management was adamant that it was not. Citigroup rated the shares a Buy. On June 26, Citigroup removed Wellpoint from its top pick list.