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Aetna lifts earnings outlook for 2011, 2012

(Reuters) - Aetna Inc, the third largest U.S. health insurer, raised its estimate for 2011 and 2012 operating earnings per share and said it bought back 40 million shares through Dec 9 this year.

Health insurers have benefited from low claims costs as Americans with coverage delay doctor visits and medical procedures while co-payments and other out-of-pocket costs are rising and the job market remains uncertain.

Aetna said it now expects to report 2011 operating earnings per share of $5.15, up from a previous forecast of $5.00 per share, and 2012 operating earnings per share of $5.00, compared with its October projection of "at least" $4.80 per share.

The 2012 estimate "appears to be a good starting point" given Aetna's history of beating and raising its earnings guidance, said Wells Fargo analyst Peter Costa.

"We expect Thursday's investor day to positively highlight Aetna's narrow network strategy and positioning for the future," he said in a note to clients, referring to an investor conference being held by the company.

The insurer said in a regulatory filing on Wednesday that it expects to have about 18.4 million medical members at the end of this year. That total is expected to drop to 17.9 million in the first quarter of next year, but to grow over the remainder of 2012, driven by commercial insurance and Medicare.

At the end of the third quarter, Aetna said it had 18.23 million members.

The company said that through Dec 9 this year it had bought back 40 million shares, and expects to have 380.5 million and 353.0 million shares outstanding at the end of 2011 and 2012, respectively.

Shares of Aetna, which closed at $39.28 on the New York Stock Exchange, were slightly higher at $39.38 in after hours trading.

(Reporting by Deena Beasley; editing by Carol Bishopric)