Motley Fool: These 3 insurance stocks are sizzling

Written by Eric Oliver | December 26, 2017 | Print  |

According to the Motley Fool, UnitedHealth Group, Aetna and Humana are the three best positioned insurance companies investors should be considering.

Here's what you should know:

1. Republican leadership repealed the ACA's individual mandate through the passage of their tax reformation bill. The Fool argues UnitedHealth Group is well positioned to maintain its customer base because the payer already exited most ACA exchanges. Most of UnitedHealth's business is through employer-sponsored and Medicare Advantage plans.

2. UnitedHealth also has the "industry's best" operating margin with a low loss ratio because of the company's status as the nation's largest health insurer. The Fool reports, "Because UnitedHealth insurers so many people, it can offer better insights into healthcare trends."

3. The Fool argues Aetna is ripe for investment because of fears over the company's recently announced merger with CVS Health. Aetna is trading below CVS Health because of regulatory approval fears. The Fool said fears that the deal will be blocked are unfounded because CVS and Aetna have very little overlap. "If regulators approve the deal, then Aetna's shares will close the gap to CVS Health's offer price, but even if regulators block it, Aetna should do fine on its own."

4. The Fool said Humana is in a good position because of its reliance on Medicare enrollment. Although Humana has other offerings, it is the largest Medicare insurer investors can buy. "If you believe that an increasingly large number of seniors are going to live longer than ever before, then it's hard to dislike Humana's Medicare-heavy business model," the article states.

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