U.S. equities are dribbling lower on Thursday as the Trump-Kim summit in Hanoi abruptly ended with no agreement. Adding to the pressure was a batch of weak economic data overnight out of Asia and a stronger-than-expected Q4 GDP report here at home, which could potentially up the pressure on the Federal Reserve to resume its rate hikes.
Moreover, the bulls continue to be content with overhead technical resistance near the 2,800 level on the S&P 500 — a level that has been in play since October.
Breath is breaking down a bit here, as traders tighten up positions after a historic start to the year. Healthcare stocks, in particular, are looking vulnerable as politicians once again talk about moving to a single-payer system in the United States.
Here are four healthcare stocks to avoid:
Cigna (CI)
Shares of Cigna (NYSE:CI), a global health insurance company that was the subject of a proposed $47 billion takeover offer from Anthem in 2015 that was rejected on antitrust grounds, is threatening a share price breakdown with a test of the lows seen in December. Shares are already down more than 20%.
The company will next report results on May 3 before the bell. Analysts are looking for earnings of $3.71 per share on revenues of $33 billion. When the company last reported on Feb. 1, earnings of $2.46 missed estimates by 3 cents on a 29.3% rise in revenues.
United Health Group (UNH)
Health plan provider United Health Group (NYSE:UNH) is watching its shares drop below their 200-day moving average in an accelerating breakdown from a recent two-month consolidation range. That marks a loss of 11% from recent levels and 13% from the highs set back in December. Political pressure is building against the health insurance companies, with Democrats in the House calling for Medicare for all, which would effectively end the private insurance market.
The company will next report results on April 16 before the bell. Analysts are looking for earnings of $3.6 per share on revenues of $59.7 billion. When the company last reported on Jan. 15, earnings of $3.28 beat estimates by 6 cents on a 12.2% rise in revenues.
CVS Health (CVS)
Shares of CVS Health (NYSE:CVS) are cratering, down another 0.6% as I write this to cap a loss of nearly 30% from the double-top high near $80 set back in November. The company recently disappointed investors with some downside guidance as investors await the outcome of the of a court decision on the merger with Aetna in a $69 billion deal.
The company will next report results on May 22 before the bell. Analysts are looking for earnings of $1.6 per share on revenues of $59.7 billion. When the company last reported on Feb. 20, earnings of $2.1 beat estimates by 8 cents on a 12.5% rise in revenues.
Humana (HUM)
Shares of health insurer Humana (NYSE:HUM) have broken down below their lower Bollinger Band and 50-day moving average, accelerating a downtrend that looks set to test the January low for a loss of around 7% from here. Shares have already lost more than 18% from the highs seen back in November. Shares were recently initiated with an overnight rating by analysts at Stephens. Poor timing.
The company will next report results on May 8 before the bell. Analysts are looking for earnings of $4.3 per share on revenues of $15.7 billion. When the company last reported on Feb. 6, earnings of $2.6 per share beat estimates by 12 cents on a 7.4% rise in revenues.
As of this writing, William Roth did not hold a position in any of the aforementioned securities.
