Keep an eye on shares of Healthways today. After sliding 40 percent since reporting weaker-than-expected Q3 numbers on Oct. 24, the wellness services provider caught a bounce of some 8 percent Friday on heavy volume. A lot of the action came early in the day, with investors picking up big chunks of Healthways (Ticker: HWAY) below $9.50. That appeared to catch the eye of others, who pushed the shares to almost $10.50. Now to see if those gains can be held...
Humana Inc. announced today it has extended its relationship with Healthways and the Franklin-based company’s SilverSneakers Fitness Program to eligible members in Pennsylvania and Nevada.
Financial terms of the arrangement, and the date for which the expansion extends, were not disclosed in a release.
The expanded agreement makes the SilverSneakers program available to more than 2.2 million Humana Medicare members nationwide.
The move follows similar contract extensions for Healthways, the most recent of which involves Schenectady, N.Y.-based MVP Health Care. (Read more here.)
Barclays Capital analyst Josh Raskin says bargain hunters shouldn't take a flier on Healthways just yet — even though the stock is off almost 30 percent today. On the back of Healthways' disappointing Q3 numbers, Raskin has lowered his price target for Healthways shares from $14 all the way down to $9. Healthways hasn't traded in the single digits in 11 months and the lack of a bounce off this morning's open (see chart below) suggests few investors expect a rebound back toward $20 anytime soon.
Brooks O'Neil at Dougherty & Co. is willing to cut Healthways CEO Ben Leedle and his team a little more slack. He has cautiously reiterated his 'buy' rating but trimmed his target to $17 from $22. The biggest issue, O'Neil says, is the loss of credibility.
Management had hinted at this issue in a recent conference presentation, but our sense was the overall outlook presented by management has continued (until yesterday) to be upbeat. Thus, we are sure investors have been largely surprised by the magnitude of the shortfall for 2013, and the weak expectation for 2014.
Franklin-based Healthways has signed a contract with Renaissance Health Network, a network of some 250 primary care physicians in the Philadelphia area, to integrate its Well-Being Direct program for the doctors' Medicare population. RHN works with 32,000 Medicare beneficiaries through its accountable care organization.
Acknowledging the impact financial stresses can have on people's psychological and physiological systems, Healthways this morning announced it is teaming up with Dave Ramsey's Lampo Group to offer financial coaching services as part of its wellness platform. Ramsey's CORE program will begin being rolled out in the first half of next year.
As part of the collaboration, Healthways will scale online delivery of the CORE™ curriculum, bringing new content, interactive features and support to the self-directed program and making it accessible via all media, including mobile devices. In addition, Healthways coaches will receive advanced training from Ramsey’s team, allowing them to address well-being improvement from a holistic point of view that factors in financial stressors.
Healthways, one of the best-performing Middle Tennessee stocks of 2013, was taken down a notch Thursday by analysts at Stephens Inc. In launching coverage of the Franklin-based wellness services provider with an 'underweight' rating, the researchers said "evolving changes" in the employer insurance market — a number of large employers are steering their workers to the newly launched insurance exchanges — pose new risks that investors haven't yet taken into account. They see the stock (Ticker: HWAY), which closed Wednesday at $18.23, sliding to $12 in the coming quarters. At one point Thursday, the shares were off almost 6 percent but they recovered to give up only 2.5 percent.
Separately on Thursday, Healthways officials announced that BlueCross BlueShield of Alabama has added another group of Medicare customers to its SilverSneakers contract with the company. The move will become effective in January.
We've detailed the impressive climb of late by shares of Healthways, which reached a five-year high last week. We also noted the relatively light volume. But the tide has definitively turned in recent days and it has done so with a vengeance. Healthways (Ticker: HWAY) has given up 15 percent in the past two and a half days of trading and it's noteworthy that the previously light volume has given way to days with action well above the average of about 585,000 shares.