Shares of insurance and pharmacy benefit manager (PBM) companies such as Centene Corp. CNC, Elevance Health Inc. ELV, Humana Inc. HUM and CVS Health Corp. CVS are trading lower Thursday, likely in reaction to UnitedHealth Group Inc.‘s UNH disappointing fourth-quarter 2024 revenue results.
What To Know: UnitedHealth, the largest health insurer in the U.S., reported a revenue increase of 6.8% year-over-year to $100.8 billion, falling short of the consensus estimate of $101.76 billion.
UnitedHealth’s stock declined sharply, falling 6.04% to $510.59, as the earnings report highlighted concerns over its medical care ratio, which rose to 85.5% from 83.2% in 2023. This increase was attributed to factors such as Medicare funding reductions, member mix changes and the timing of Medicaid redeterminations.
UnitedHealth also reaffirmed its 2025 guidance, projecting $450 billion to $455 billion in revenue and adjusted EPS of $29.50 to $30.00.
The broader sector saw a ripple effect. The declines potentially reflect investor apprehension about sector-wide pressures, including reimbursement challenges and operational costs, spotlighted by UnitedHealth’s earnings report.
Price Actions: Closing Thursday, Centene stock dropped 0.44% to $62.87, CVS Health slid 0.15% to $51.96, Elevance Health fell 1.03% to $385.26 and Humana dropped 1.62% to $274.97 according to Benzinga Pro.
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