RBC says presidential debate bodes well for managed care stocks

RBC Capital says the first presidential debate last night bodes well for managed care organizations. The firm expects stronger sentiment around managed care following President Biden’s “lackluster performance.” Based on conversations in recent weeks, RBC sees clear expectations for a lift in regulatory headwinds weighing on the leading Medicare Advantage carriers UnitedHealth (UNH), Humana (HUM) and CVS Health (CVS) in a Trump administration. A more favorable regulatory backdrop could mean a lift in Federal Trade Commission and Justice Department scrutiny over vertical integration strategies, which would be particularly positive for UnitedHealth, the analyst tells investors in a research note. The firm believes a Trump administration would also ease DOJ scrutiny around Optum and vertical integration between health plans and Optum Health’s primary care platform. Among post-acute operators, RBC would expect a Trump victory to be most immediately beneficial for Addus HomeCare (ADUS), Ensign Group (ENSG) and Pacs Group (PACS).