Costa is continuing to expand in the area of health services. The company announced plans to develop a range of health-care-related products for some older members in the coming years, in collaboration with the non-profit Medicare Advantage Agency, SCAN Health Plan.
This cooperation is still subject to regulatory approval, and the parties have yet to announce a clear lead time. However, with the disclosure of the news, the market's expectations for the Costa expansion of medical services have risen, leading to a small increase in stock prices.
Plan to cover pharmacies and audio-visual services
According to mutual disclosure, the services to be introduced may include adjusted pharmacy experience, Medflex non-prescription drug benefits, and protections related to vision, hearing and hearing. The relevant products are expected to be available in the future through the Costco Gate, insurance agents and online channels.
SCAN, which is mainly for the elderly, currently operates in 33 counties in California, Arizona, Nevada, Texas, New Mexico and Washington. Both sides wish to combine health-care products with the existing health services in Costco and to improve the accessibility of Medicare Advantage members.
Regulatory clearance remains a prerequisite for landing
This cooperation is still in the preparatory stage and its formal launch is dependent on the outcome of the regulatory review. The parties have yet to disclose the price of the product, the specific up-line tempo and the amount of revenue that cooperation will bring to Costco.
This means that, in the short term, the market is more concerned with the direction of Costco in the health sector, rather than the immediate financial contribution of cooperation.
The stock price goes up a little bit after the news.
After the announcement, Costa received $961.35 on Tuesday, an increase of 0.82 per cent over the previous transaction date and $7.85 per day. The post-award share price continued to rise in small amounts, with an estimated $962.83, an increase of 0.15 per cent over the closing price.
The CEO of Costco, Ron Vachris, stated that this cooperation was a continuation of the company ' s long-standing strategy of providing members with high-priced necessities and expanding health services.