Ahead of the Bell: Express Scripts

Analyst raises Express Scripts' rating; says uncertainties around member enrollment gone

Associated Press

NEW YORK (AP) -- A Jefferies analyst lifted his rating and price target for Express Scripts on Monday, saying uncertainties surrounding member enrollment and contract attrition is gone.

Brian Tanquilut said in a client note that Express Scripts Holding Co.'s strong first quarter suggests that beneficiary enrollment is stable. Late last month the St. Louis company reported that its quarterly earnings rose 39 percent compared to last year, when charges tied to its acquisition of competitor Medco Health Solutions hurt the pharmacy benefit manager's performance. Express Scripts also increased its full-year earnings forecast.

"With a good membership baseline now established for 2013 and contracting visibility for 2014 improving, we believe downside risk has moderated meaningfully and the stock should begin to gradually creep up," the analyst wrote.

Tanquilut raised Express Scripts' rating to "Buy" from "Hold" and boosted its price target to $74 from $56.

A representative for Express Scripts did not immediately respond to an email seeking comment.

Its shares closed at $61.40 on Friday. That is near the high end of their 52-week range of $49.79 to $55.06.

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