Health Insurer Centene Corp raised its adjusted profit forecast for 2024, bringing it broadly in line with Wall Street expectations. In November, rival United Health Group also raised its 2024 profit, which is in line with market estimates.
U.S. equities were slightly higher at midday as the latest reports on consumer prices showcased inflation easing ahead of tomorrow’s decision on interest rates in the final meeting of the Federal Reserve in 2023.
Centene(CNC) shares rose as lower costs assisted the health insurance provider in raising its 2024 guidance and increasing its stock buyback program by $4 billion.
Shares of Franklin Resources(BEN) increased when the company reported assets under management(AUM) were up 6% in November to $1.41 trillion.
Oracle(ORCL) was the worst-performing stock in the S&P 500 after the database software maker missed revenue estimates as sales of its products and services were lower than expected.
Chief Financial Officer Drew Asher said, “Centene expects about $1 billion in annual revenue from providing Medicaid Health Insurance plans to low-income individuals in Oklahoma starting from April.”
The Health Insurance company also expanded its Medicaid business to North Carolina.
Meanwhile, Centene is also prepared for a $7.5 billion hit to its 2024 revenue as many Medicaid members, who applied under the pandemic relief measures, will become illegible from April 1, 2024.
Centene expects a 2024 medical loss ratio, of services, between 87.3% and 87.9%, compared with LSEG estimates of 87.81%.
It is estimated that the 2024 adjusted profit will be greater than $6.70 per share, compared to the previous estimate of greater than $0.60. According to LSEG data, Analysts on average were expecting a profit of $6.77 per share.
CEO Sarah London said, “Centene expects adjusted profit to grow by an average of 12% to 15% annually over the long term.”
The projected revenue of Centene is around $142.5 billion to $145.5 billion, which is higher than the previous estimates of analysts at $142.1 billion.
