Ahead of the Bell: Aetna upgraded on 1Q earnings and outlook

NEW YORK—Aetna Inc. was upgraded by Credit Suisse Friday, as the health insurer posted stronger-than-expected revenue and maintained its profit forecasts.

Aetna Inc. reported its first-quarter results late Thursday. Its profit fell to 92 cents per share, which matched analyst estimates, but revenue grew 16 percent -- more than Wall Street expected. The company said it expects a profit of $4 per share in 2008.

Credit Suisse analyst Gregory Nersessian upgraded the stock to "Neutral" from "Underperform," saying Aetna is "simply out-maneuvering the competition in the marketplace and staying one step ahead of emerging industry trends."

Nersessian said he is more confident in the company's profit forecast because Aetna's enrollment grew during the quarter, and medical costs were stable.

Citi analyst Charles Boorady raised his profit estimates over the next four years, saying Aetna is the only health care company that was not forced to lower its profit forecast this year. He thinks the results should reduce investor concerns about trends in the health care industry.