Healthcare provider WellPoint (WLP) is surging after CEO Angela Braley announced her resignation. Braley had been CEO for the past five years, but according to several reports, many large shareholders were growing frustrated with the company’s financial performance.
We have exposure to WellPoint via the Health Care SPDR ETF (click ticker for report: ) in our Best Ideas Newsletter and feel industry fundamentals are positive for the firm and the industry as a whole. Executive Vice President John Cannon will lead the firm on an interim basis, and we expect the company to look for a new CEO with significant experience in the healthcare space.
We’re feeling even better about the space after recent acquisitions by Aetna (AET) and WellPoint, as well as hedge fund manager David Einhorn’s decision to establish a position in virtually every major insurer. However, we continue to believe the Health Care SPDR ETF is the best way to gain broad-based exposure to increased health care spending in coming years.