WellCare Health Plans, Inc. (WCG)

Possible benefit from Obamacare

$6.8B Sales trading for cash on hand. Although legal matters scare me, I think that the market has oversold this stub.

EMA Cross

Currently trading hands at a ludicrously low single digit multiple to FCF, Wellcare is providing investors with nothing short of an incredible opportunity to earn a double or more with relatively low risk over the next year or so.

As Bruce Berkowitz said recently in the latest OID, "Once WellCare concludes its legal issues -- and the settlement reserves and outrageous legal and accounting bills stop -- their true earnings power will become apparent." I agree. Wellcare's ability to generate cash over the next few years and beyond is being obscured by a number of temporary issues/concerns (both company and industry specific), none of which permanently impair their franchise. The bottom line is that this company is just way to cheap relative to its long term earnings power. Outperform.

Wellcare has recently filed all of its late financial statements and is in compliance with listing rules. Fairholme owns its debt maturing in May, so they won't have a problem refinancing it (Fairholme also owns 20% of the equity). This company has earning power of $5 per share. If you assume the government will squeeze their margins, and earnings drop by half, you're still buying it at 5x earnings today. So it's a compelling buy no matter what; nobody else can do Medicare/Medicaid if not for these specialized HMOs.

cash machine, buy with every penny u have

combination of market downturn and the feds

Defensive based on z-score table here:

http://www.thestreet.com/story/10446139/3/balance-sheets-101-who-might-survive-this-crisis.html

Fairholme, tracking

In Pabrai and Berkowitz I trust.

aFTER ELECTION CYCLE ALL WILL BE ON TABLE IN NAT HEALTH CARE DEBATE AND REFORM AND THEY ARE WELL POSITIONED AT LOCALE AND STAT LEVELS THROUGH OUT COUNTRY ESPECIALLY BY MEANS OF THE AND BACKING OF THE SOROSS CONNECTIONS AND GROUP THEIR CONTACTS AND CONTRACT SIGNED AND PENDING...

This is a contrarian pick and I think healthcare will do well in the midst of a weak U.S. economy. I see little downside to this stock from here, with a lot more upside potential.

The value of this company did not drop 80%

Reasonable bet that this stock will outperform in the long term.

With Pabrai and Berkowitz of Fairholme on board, I'm also a believer that the hit this company took following the news of an investigation was a bit exaggerated. It should emerge fundamentally unscathed.

mp

Health care is stable and this company is undervalued. With solid fundamentals and a scandal no longer an issue this thing is ready to blast off.

Recently, it's been showing signs of a strong stock.

valuepick