) to hold from sell.
Analyst David Shove says the results are in line with the July 17 pre-announcement. He notes on an operating front, higher premium yields lowered the loss ratio slightly. He says the company continues to shed its money-losing business, but is likely do so for the next 12 months. He notes although PacifiCare is facing challenges, the company currently is profitable, and EBITDA is improving.
Shove expects visibility to remain clouded for the rest of 2001, but thinks shares should gain stability once the refinancing of the current credit line is accomplished later in 2001. He raised the $1.53 2001 EPS estimate to $1.63, and raised the $1.75 2002 estimate to $1.90. He upped his $12 target to $13.