Centene is Friday's IBD Stock Of The Day as it stands up well against the volatile market. CNC stock is regaining technical support within a valid base.
The St. Louis-based company is one of the largest Medicaid-based managed care organizations in the country. While Centene primarily provides health care products and services through Medicaid and Medicare, it also works through private insurers.
CNC and other managed care providers have been mounting a rally this week amid a market that has been rocked by fears of a recession.
Centene Stock
CNC stock closed down 0.9% to 82.91 in Friday's market trading. The stock is above its 50-day moving average and has formed a double-bottom base with an 87.44 buy point, according to MarketSmith analysis. If Centene manages to get above its high from Thursday high, around 84, it would break a downward sloping trendline. That would provide aggressive investors an early entry around that 84 level.
CNC peer UnitedHealth is also in a double-bottom base. The buy point on that base is 507.35. This competing health insurance giant was Thursday's IBD's Stock Of The Day.
Centene beat Wall Street's first-quarter predictions with revenue increasing 24% year over year. Analysts predict that CNC earnings per share will increase 8% in 2022 and that revenue will edge up 13%, according to FactSet.
Last week, Centene increased its 2022 full-year guidance. The company cited increased Medicaid premium revenue and "favorable" insurance marketplace performance so far in the second-quarter as reasons for the guidance increase.
Funds and other institutional investors own 67% of Centene's outstanding shares. As of March, 2,269 funds owned CNC shares, an increase of 124 since December, according to MarketSmith.
Centene has a 97 Composite Rating, a key IBD benchmark. It has a 94 Relative Strength Rating, an exclusive IBD Stock Checkup measurement for share price movement with a top grade of 99. The rating shows how a stock's performance over the last 52 weeks holds up against all the other stocks in IBD's database. The EPS rating is 93.
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