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Centene Continues to Capitalize on Obamacare and So Will You

Tickers in this article: CNC HNT IHF MOH

NEW YORK (TheStreet) -- Centene is in the health care sweetspot thanks to being part of one of the leading industry groups this year, health care providers.

Centene shares, at $80, are up 35% for the year to date.

Concerns about the launch of the Affordable Care Act, aka Obamacare, sent these stocks into a tailspin at first, but most of these stocks have since regained ground over the last few months as investors realize the growth potential.

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There continues to be conflicting court rulings surrounding the legality of Obamacare subsidies, but in the absence of a U.S. Supreme Court decision, the provider stocks appear to be shrugging off these lower court rulings.

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Centene provides programs and related services to address the needs of the under-insured and uninsured individuals. It offers Medicaid and Medicaid-related coverage to individuals through government subsidized programs and operates in 21 states.

As a result of the Affordable Care Act, an additional six million Americans have enrolled in Medicaid and related health programs for the poor through the end of April. More people are now eligible for state Medicaid programs and many of these states are expanding their programs and contracting with private health insurance companies like Molina , Health Net  and Centene. Medicaid is now a growth story and these companies are the beneficiaries.

Earnings Results

On Tuesday, Centene reported strong second-quarter earnings results of 95 cents vs. the consensus of 72 cents. Revenue of $3.74 billion also beat the consensus estimate of $3.65 billion. The company guided up this year's earnings to a range of $3.70-$3.90 vs. prior guidance of $3.60-$3.90 and the consensus of $3.73.

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