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Walmart announced that it will start selling Medicare insurance plans in 50 states and Washington as the world’s largest retailer expands its health services.
Walmart (WMT) said that Walmart Insurance Services, its licensed insurance brokerage, will begin selling Medicare insurance plans during this year’s annual enrollment period from Oct. 15 through Dec. 7.
The move comes as Walmart is looking to expand its health services offerings at low, transparent prices, while also simplifying in what the retailer said has historically been a cumbersome, confusing process.
“We want customers to feel confident in selecting a Medicare plan that best fits their needs, budget and lifestyle,” Walmart Insurance Services general manager David Sullivan said. “Helping customers select the right Medicare insurance plan to meet their needs aligns with Walmart’s mission of helping people save money and live better.”
According to Sullivan only 1 in 10 Medicare beneficiaries are enrolled in a plan that saves them the most on out-of-pocket spending. Medicare is a health insurance plan provided by the US government to individuals who are 65 and older. Younger people with certain disabilities may also qualify.
Walmart Insurance Services will sell Medicare plans offered by health insurers Humana, UnitedHealthcare, Anthem Blue Cross Blue Shield, Amerigroup, Simply Health, Wellcare (Centene), Clover Health and Arkansas Blue Cross and Blue Shield. More carriers are expected to be added in the future.
Last week, Walmart announced that it has sold its UK grocery unit Asda to the Issa brothers and TDR for an enterprise value of £6.8 billion, on a debt-free and cash-free basis.
Shares in Walmart have been going from strength to strength since hitting a low in March and are now trading 18% higher than at the start of the year. What’s more, the $149.35 average price target implies 6.2% upside potential over the coming year.
Following the Asda deal, Telsey Advisory analyst Joe Feldman raised his price target by $10 to $155 and reiterated a Buy rating on the stock, saying that the deal “closes a multi-year effort to monetize the business.”
“Broadly, we like Walmart's new portfolio-based approach to its international businesses,” Feldman wrote in a note to investors. “The company seems to be monetizing more mature businesses to free capital to invest in emerging areas and countries.”
“The recent decision to put capital in growth areas, such as Walmart Fulfillment Services, and emerging companies, such as JD.com, Flipkart, Dada-Nexus, and likely TikTok, should help generate solid returns over the medium term and keep Walmart ahead of the curve,” the analyst summed up.
The rest of the Street is in line with Feldman’s bullish outlook. The Strong Buy analyst consensus boasts 23 Buy ratings versus 7 Hold ratings. (See Walmart’s stock analysis on TipRanks).
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