Health and Healthcare
Revised Guidance Sinks Health Care Company (CNC, MOH, AGP, UNH, WCG)
Published:
To say that Centene Corp. (NYSE: CNC), a managed health care provider, has been on a roller coaster ride for the past few days may be an understatement. First, it and Molina Healthcare Inc. (NYSE: MOH) fell sharply on Thursday following new, lowered guidance from Molina related to costs outpacing revenues in Texas, where both companies do business. Then on Friday, both companies got the welcome news that contracts in Ohio had been awarded.
Today, Centene revised its EPS guidance down by more than $1/share, from $2.64-$2.84 to $1.45-$1.65 on what the company called “negative financial results” in Kentucky and Texas. The company now projects a loss in the second quarter, but says profitability will return in the third quarter. The consensus estimate for the second quarter had been EPS of $0.58 and for the full year EPS of $2.68. Centene is also considering taking a non-cash impairment charge on its Celtic individual health policies of $28 million, which is not included in today’s revised guidance.
For the past 12 months, Amerigroup Corp. (NYSE: AGP) shares are down nearly -16% compared with Molina, down about -16.5% and Centene down -21%. Providers Wellcare Health Plans Inc. (NYSE: WCG) and Unitedhealth Group Inc. (NYSE: UNH) are up 8% and 20%, respectively.
Centene attributed the revised guidance to higher costs and significantly more non-inpatient claims in May. Ultimately Centene will be forced to raise premiums to cover rising costs, and so will Molina and probably the others as well. The upward spiral of US health care costs continues.
Paul Ausick
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.