Healthcare Stocks: Magellan Health Services (MGLN)
Magellan Health Services (MGLN) recently rebranded its business lines into three distinct units. The company’s behavior health affiliates, along with integrated health business Magellan Complete Care, are branded under the Magellan Healthcare business. Magellan Rx Management focuses on Magellan’s pharmacy business. And the specialty solutions business is now branded under NIA Magellan.
Although MGLN took a huge earnings hit in the fourth quarter of last year due to higher costs in providing care, its revenue continues to strengthen and should fare well with growth in public-sector pharmacy volume, as well as the launch of new products and services.Those new services include a particularly innovative audit tool, MRxAudit that can be used by groups to determine the effectiveness of their pharmacy benefit management services.
Another positive: Florida’s Agency for Health Care Administration chose MGLN to administer its Medicaid specialty plan for individuals with serious mental illness. The program will be implemented in eight regions throughout Florida and in 40 of its 67 counties. Right now, MGLN stock has a forward P/E of about 19 — roughly average for healthcare stocks.