Humana Inc. HUM recently entered into a definitive agreement to purchase the privately held Enclara Healthcare (Enclara), a leading hospice pharmacy and benefit management provider, from Consonance Capital Partners and Enclara management. Expected to close in the first half of 2020, the deal will likely have an immaterial impact on 2020 earnings. However, financial terms of the transaction were not disclosed.
A Few Details About Enclara
Enclara, one of the nation’s largest hospice pharmacy and benefit management providers, aims at easing care delivery for patients resorting to complex care. It serves more than 450 hospice providers and 97,000 hospice patients daily. The transaction includes the acquisition of Enclara Pharmacia, GuidantRx and Avanti Health Care Services and is subject to certain closing conditions.
Rationale Behind the Deal
With this strategic move, Humana would be able to enhance its wide-ranging care package to serve pharmacy-based requirements associated with hospice care. Additionally, the company would also be able to simplify the mail order pharmacy experience and upgrade its technology stack for in-house pharmacy via better mobile medication management and electronic medical record (EMR) connectivity.
Humana looks forward to utilizing Enclara’s clinical management expertise and its trusted relationship with customers that it has built over the past 20 years. The move is in line with its commitment to provide enriched healthcare to individuals.
Moreover, the deal would allow it to boost its PBM game, which is necessary as other insurers are also putting in concentrated efforts to solidify their presence in the pharmacy benefit management space. For example, Anthem, Inc. ANTM launched its own PBM, IngenioRx.
Other Significant Acquisitions
Acquisitions have always been the company’s major growth trajectory. Some most significant ones are the purchase of Family Physicians Group, Your Home Advantage, Curo and a share in Kindred at Home, which helped the company deepen its toes in the home health and hospice market. These tactical initiatives paved way for the company’s growth.
Zacks Rank and Share Price Movement
Shares of this Zacks Rank #3 (Hold) company have gained 25.3% in a year's time, outperforming its industry’s growth of 12.3%.
Stocks to Consider
Investors interested in the medical sector might consider some better-ranked stocks like Select Medical Holdings Corporation SEM and WellCare Health Plans, Inc. WCG. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Select Medical Holdings operates critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics and occupational health centers. In the trailing four quarters, the company’s average beat was 11.07%. The stock sports a Zacks Rank #1.
WellCare Health offers managed care services to government-sponsored health care programs. The company pulled off average positive surprise of 17.32% in the preceding four quarters. It carries a Zacks Rank #2 (Buy).
Free: Zacks’ Single Best Stock Set to Double
Today you are invited to download our latest Special Report that reveals 5 stocks with the most potential to gain +100% or more in 2020. From those 5, Zacks Director of Research, SherazMian hand-picks one to have the most explosive upside of all.
This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
See 5 Stocks Set to Double>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Humana Inc. (HUM) : Free Stock Analysis Report
Select Medical Holdings Corporation (SEM) : Free Stock Analysis Report
Anthem, Inc. (ANTM) : Free Stock Analysis Report
WellCare Health Plans, Inc. (WCG) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research