Anthem

Gail K. Boudreaux has a lot on her plate. As CEO of Anthem, one of America’s largest healthcare benefits companies, the double gut punch of COVID and a spittle flecked run in to the US election, has souped-up the sector and de-rated her share price. Shareholders though, should rest easy. In a good corporate shemozzle, Boudreaux is the sort of person you want on guard. Before a glittering corporate career, Boudreaux was Dartmouth College’s all-time leading scorer on the basketball court. She also flung a shot put 46 feet, earning All American status. Job done. The prospect of a Democratic sweep in November’s election then, is not going to knock her, or her team, off ambitions to deliver a smorgasbord of double digit EPS growth. Now the US Healthcare system is complicated. It is also one of the least efficient in the world. Anthem, though, is a critical operator providing health insurance to both private Individuals, and to government programmes such as Medicare and Medicaid. It has dominant market share in the states it operates in, which enables it to have tighter negotiations on pricing with hospitals and other providers. A recent deal with CVS Health also means it will be able to have the lowest drug prices. Even in a recession, what they lose on the commercial side, they gain in Medicaid. And health insurance is a recurring annual purchase. It’s a must have. More so, even, than ESPN Sport. Indeed, the medium term earnings picture looks compelling. Eleven thousand seniors age into Medicare, every day; and enrolment is projected to pass 67 million by 2023. And this is before Boudreaux flexes the opportunity to diversify into value added services to help personalise care for those with complex and chronic conditions. This all good news; good news for shareholders and good news for a cheap-looking share price.