Can This Healthcare Stock Insure Your Portfolio?

ANTM is cooling from a late-April record high

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Anthem Inc (NYSE:ANTM) has added 7.5% in 2022 so far, and nearly 30% in the past 12 months. While it's cooled slightly from its April 21 record high of $533.68, the 40-day moving average has kept the recent pullback in check. Anthem also offers a dividend yield of 0.99% with a forward dividend of $5.12.

antm chart march 3

Moreover, Anthem stock provides a great level of security and stability with its fundamentals. The insurance company has managed to maintain consistent top and bottom line growth in recent years, reporting a 57% increase in revenues and a 67% increase in net income between fiscal 2018 and fiscal 2021. More specifically, ANTM reported 4% revenue growth and 34% net income growth for fiscal 2021.

Anthem is also estimated to increase revenues by 12.3% and earnings by 10.1% for fiscal 2022. Furthermore, ANTM carries a decent balance sheet with $33.03 billion in cash and $24.03 billion in total debt. However, Anthem stock’s valuation has pushed to new highs, as the market continues to reward and favor fundamentally stable companies. This has led ANTM to trade at a relatively high forward price-earnings ratio of 17.61. Nonetheless, Anthem stock continues to be a strong option for long-term investors looking for safe, but limited, returns.

Now could be a good time to speculate on ANTM's next move with options, too. The security's Schaeffer's Volatility Index (SVI) of 34% sits higher than 77% of readings from the past year. In other words, options traders are pricing in relatively low volatility expectations at the moment. 

 

 




 
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