Yahoo Finanza Health Care Giant Centene’s Shares Fall After Q4 Profit Misses Estimates
Clayton-based managed health care giant Centene Corp. reported a lower-than-expected profit in the fourth quarter due to higher testing and treatment costs associated with COVID-19 pandemic, sending its shares down about 2% in pre-market on Tuesday.
The U.S. health insurer said its diluted loss per share for the fourth quarter of 2020 of $(0.02), compared to diluted EPS of $0.49 for the fourth quarter of 2019. Diluted EPS for the full year 2020 of $3.12, compared to $3.14 for the full year 2019.
Adjusted diluted EPS for the fourth quarter of 2020 of $0.46, compared to $0.73 for the fourth quarter of 2019. That was lower than the market expectations of $0.47 per share. Adjusted diluted EPS for the full year 2020 of $5.00, compared to $4.42 for the full year 2019.
Centene total revenues of $28.3 billion for the fourth quarter of 2020, representing 50% growth compared to the fourth quarter of 2019, and $111.1 billion for the full year 2020, representing 49% growth year-over-year.
Centene shares, which fell 4.5% in 2020, has declined nearly 3% so far this year. The stock fell about 2% to $57.25 in pre-market trading on Tuesday.
Centene Stock Price Forecast
Thirteen analysts who offered stock ratings for Centene in the last three months forecast the average price in 12 months at $79.15 with a high forecast of $94.00 and a low forecast of $68.00.
The average price target represents a 35.90% increase from the last price of $58.24. From those 13 analysts, nine rated “Buy”, four rated “Hold”, and none rate “Sell”, according to Tipranks.
Morgan Stanley gave a base target price of $94 with a high of $135 under a bull scenario and $55 under the worst-case scenario. The firm currently has an “Overweight” rating on the health insurer’s stock.
Several other analysts have also recently commented on the stock. Cowen and company lowered the target price to $80 from $83. Jefferies cut the price objective to $72 from $75. Credit Suisse raised the target price to $73.5 from $68. Truist Securities lowered the target price to $80 from $85. Deutsche Bank cut the target price to $77 from $83. Stephens lowered the target price to $69 from $71.
Analyst Comments
“Centene is the largest Medicaid player with 21% market share. Wellcare acquisition will expand Centene market presence into Medicare Advantage, the fastest-growing market. Since acquisition announcement, standalone Wellcare has outperformed suggesting potential upside to deal accretion based on S-4 estimates (breakeven in Y1 and mid-single-digit accretive in Y2),” said Michael Cyprys, equity analyst at Morgan Stanley.
“Additional upside opportunities from insourcing PBM and the integration of medical and pharmacy benefit. While ACA repeal would be a headwind, we assign a low probability to this outcome.”
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This article was originally posted on FX Empire
