Time To Sell?

There is always debate about captive PBMs (i.e., those owned by a managed care company).  In theory, I have always argued that they should have a leg up.  But, since pharmacy represents only 10% of total healthcare spend, the majority of the strategic focus is typically on the health insurance side of the business.  [BTW – The 3 largest captive PBMs are Wellpoint, Aetna, and Cigna.]

So, if you look at the stock charts below, you can see that while the PBMs (Express Scripts, Medco, and CVS Caremark) have all held up pretty well the managed care stocks (Aetna, Cigna, United Healthcare, Humana, and Wellpoint) have not held up as well.

If I owned a captive PBM, would this be the time for me to consider selling?  I have heard this debate a lot more recently than in recent years.

PBM 5-Year Stock Chart

express-medco-cvs-caremark-5-yearManaged Care 5-Year Stock Chart

wellpoint-cigna-aetna-united-humana-5-year[As I have disclosed before, I do not hold any individual stocks.]

No comments yet... Be the first to leave a reply!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: