Insider Buying at Hedge Fund Darling Express Scripts

The closest publicly traded peer for Express Scripts Holding Company is Catamaran Corp (NASDAQ:CTRX). Catamaran’s stock price is up 47% in the last year, which has brought it to generally high earnings multiples. The company has been growing rapidly but still trades at 22 times forward earnings estimates- so it will need to improve at a considerably faster rate than Express Scripts after that point, assuming that it even meets the Street’s goals. Recent growth rates have been high enough, however, that investors should look into how likely continued growth might be and possibly consider Catamaran as a growth stock.

Express Scripts is doing well at building its business back up, and if we look at last quarter’s results- though obviously such a short time frame is prone to error- the valuation does not look too expensive. Given the insider purchase as well we certainly think that investors should be watching for the next quarterly report even if they are not willing to do more research on the company at this time. If there is a decent amount of secular growth occurring in addition to the recovery of its former business, then it might be a good value considering the multiples on more recent earnings numbers.