Many health insurance companies are involved in a buzz of M&A activity, as the industry is responding to the aftershocks of the Affordable Care Act. One of the aftershocks was the consolidation of hospitals as health care providers. Last year, there were 95 mergers involving regional hospitals. Left alone, these hospitals will have too much clout in setting prices of health care. To counter that clout, the market is preparing and applauding the merger of health insurance companies, which pay the fees for health care provided by the hospitals. The possible spoiler of all these merger talks is a pending Supreme Court decision expected in June 2015, which may deal a death blow to Affordable Care Act. However, judging by the increase in the stock prices of both acquirers and acquirees, the market may well expect that the administration will get a favorable Supreme Court decision – or that Congress will ‘fix’ the language of the Act that currently seems to suggest that health care subsidies are available only to people in states that have set up state exchanges. Here are some of the best health insurance companies TheStreet Quant Ratings says you should consider looking at. Number 3 is MetLife. With an ‘A-‘ rating, the company’s strengths can be seen in its revenue growth and attractive valuation levels. 2nd is, Torchmark Corporation. This rating is an ‘A.’ Torchmark has good cash flow from operations and attractive valuation levels. Number 1 is Lincoln National. With an ‘A’ rating, the company flourishes in its solid stock price performance and revenue growth. TheStreet Ratings are algorithmic stock picks based on 32 major data points. S&P 500 stocks rated ‘buy’ yielded a 16-and-a-half-percent return in 2014, beating the S&P 500 Total Return Index by more than 300 basis points. For the full reports on these stocks, you can check out TheStreet.com/QuantRatings.
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