Aetna Inc (NYSE:AET) shares dipped in premarket trade despite unveiling market-beating fourth quarter numbers.
In the quarter, the company said net income came in at US$244mln or 74 US cents a share, sharply up from the US$139mln or 39 US cents a share in the year earlier period.
READ: Aetna raises its 2017 profit forecast despite reporting decline in third quarter revenue
In the same period, adjusted per per-share earnings stood at US$1.25, comfortably beating market consensus of US$1.17.
Revenue fell by 6% to US$14.8bn from the US$15.7bn posted a year earlier, but it was still just about ahead of what the market had pencilled in at US$14.7bn.
Revenue was down due to lower income from premiums, with the company saying it was “primarily due to lower membership” in Affordable Care Act-related products, its fee’s temporary suspension and decreased membership in Medicaid products.
READ: CVS Health to buy Aetna for US$69bn amid rumours Amazon will move into pharmaceuticals
Aetna also included a US$99mln expense on the revaluation of deferred tax assets as part of the US tax reform.
Tax reform to boost gross adjusted earnings
In a statement, the company said it expects the new revenue recognition rule that took effect from January 1 to raise revenue and expenses by US$1.5bn to US$2.0bn this year.
Further, the new tax reform bill is expected to boost the company’s gross adjusted earnings by about US$800mln in 2018.
Aetna has agreed to be bought over by CVS Health Corp (NYSE:CVS)
In premarket, its shares were down 1.88% at US$190.10.