IL’s local stocks to watch

Insider started the stocks to watch feature not as investment advice, but so people in the Louisville-area can get a different kind of insight into how firms either based here or with a strong presence here are viewed. And with that disclaimer, let’s proceed…

1. Humana, Inc. (Ticker: HUM): Humana’s been a great stock for those holding it for the long haul. And recent news has only buoyed the company’s shares more.

Most recently Humana’s gained a lot of national attention for the launch of its Points of Care website, which it set up for its 2.9 million Medicare Advantage members. Essentially, POC offers online health and educational tools for its members. The site launched on Dec. 16.

Also, in recent news, Insurancenewsnet.com broke the story that Humana will offer a new health insurance plan to Missourians purchasing insurance through the state’s health exchange.

Over the past five days Humana shares are up 3.2 percent, while the Standard & Poor’s 500 is pretty much flat.

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Humana’s shares also have had a great 2014, up 42.4 percent year-to-date, while the S&P 500 is 12.9 percent. Humana’s price-to-earnings ratio is 23.7, making it a bit expensive when compared to its direct peers, but not to the overall health care industry. It also pays a modest annual dividend of 0.76 percent.

For more information on how it stacks up to its peers, here’s a chart from Yahoo:

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2. Pharmerica Corp. (Ticker: PMC): This Louisville-based pharmacy operator recently was upgraded to an “outperform” rating by the analysts at Zacks, and they target shares to rise to $24.60, up from its current price of $20.55. Screen Shot 2014-12-18 at 12.19.41 PM

Also, most other brokers that cover the stock also rate it a buy, with only one rating it a “strong sell.”

The stock has certainly had a bumpy ride. Most of 2014 was very strong until early November when the firm’s shares started plummeting like a stone:

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The drop correlates to Pharmerica’s Nov. 6 release of its quarterly report, where it reported negative net income. Now the firm’s PE ratio hovers near 80, because the earnings portion of that equation is so bad.

So, Pharmerica is a firm that’s seen its stock recently plummet but a lot of Wall Street seems to like it anyway.