Spotting Winners: Alignment Healthcare (NASDAQ:ALHC) And Health Insurance Providers Stocks In Q3

Earnings results often indicate what direction a company will take in the months ahead. With Q3 behind us, let’s have a look at Alignment Healthcare (NASDAQ:ALHC) and its peers.

Upfront premiums collected by health insurers lead to reliable revenue, but profitability ultimately depends on accurate risk assessments and the ability to control medical costs. Health insurers are also highly sensitive to regulatory changes and economic conditions such as unemployment. Going forward, the industry faces tailwinds from an aging population, increasing demand for personalized healthcare services, and advancements in data analytics to improve cost management. However, continued regulatory scrutiny on pricing practices, the potential for government-led reforms such as expanded public healthcare options, and inflation in medical costs could add volatility to margins. One big debate among investors is the long-term impact of AI and whether it will help underwriting, fraud detection, and claims processing or whether it may wade into ethical grey areas like reinforcing biases and widening disparities in medical care.

The 12 health insurance providers stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.3% while next quarter’s revenue guidance was 1.4% below.

While some health insurance providers stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.7% since the latest earnings results.

Alignment Healthcare (NASDAQ:ALHC)

Founded in 2013 with a mission to transform healthcare for seniors, Alignment Healthcare (NASDAQ:ALHC) provides Medicare Advantage health plans for seniors with features like concierge services, transportation benefits, and technology-driven care coordination.

Alignment Healthcare reported revenues of $993.7 million, up 43.5% year on year. This print exceeded analysts’ expectations by 1.2%. Overall, it was a strong quarter for the company with a beat of analysts’ EPS estimates and full-year EBITDA guidance exceeding analysts’ expectations.

“Our third quarter results mark the third consecutive quarter in which we surpassed the high end of our guidance across all key metrics,” said John Kao, founder and CEO.

Interestingly, the stock is up 29.7% since reporting and currently trades at $22.20.

Read why we think that Alignment Healthcare is one of the best health insurance providers stocks, our full report is free.

Best Q3: CVS Health (NYSE:CVS)

With over 9,000 retail pharmacy locations serving as neighborhood health destinations across America, CVS Health (NYSE:CVS) operates retail pharmacies, provides pharmacy benefit management services, and offers health insurance through its Aetna subsidiary.

CVS Health reported revenues of $102.9 billion, up 7.8% year on year, outperforming analysts’ expectations by 4.1%. The business had an exceptional quarter with an impressive beat of analysts’ same-store sales estimates and a solid beat of analysts’ revenue estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 11.8% since reporting. It currently trades at $72.50.

Is now the time to buy CVS Health? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Molina Healthcare (NYSE:MOH)

Founded in 1980 as a provider for underserved communities in Southern California, Molina Healthcare (NYSE:MOH) provides managed healthcare services primarily to low-income individuals through Medicaid, Medicare, and Marketplace insurance programs across 21 states.

Molina Healthcare reported revenues of $11.48 billion, up 11% year on year, exceeding analysts’ expectations by 4.6%. Still, it was a slower quarter as it posted a significant miss of analysts’ full-year EPS guidance estimates and a significant miss of analysts’ EPS guidance for next quarter estimates.

As expected, the stock is down 5.8% since the results and currently trades at $183.73.

Read our full analysis of Molina Healthcare’s results here.

Clover Health (NASDAQ:CLOV)

Founded in 2014 to improve healthcare for America's seniors through technology, Clover Health (NASDAQ:CLOV) provides Medicare Advantage plans for seniors with a focus on affordable care and uses its proprietary Clover Assistant software to help physicians manage patient care.

Clover Health reported revenues of $496.7 million, up 50.1% year on year. This print topped analysts’ expectations by 5.4%. Taking a step back, it was a mixed quarter as it also recorded an impressive beat of analysts’ revenue estimates but full-year EBITDA guidance missing analysts’ expectations significantly.

Clover Health delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The company added 2,903 customers to reach a total of 109,226. The stock is down 31.5% since reporting and currently trades at $2.41.

Read our full, actionable report on Clover Health here, it’s free.

Elevance Health (NYSE:ELV)

Formerly known as Anthem until its 2022 rebranding, Elevance Health (NYSE:ELV) is one of America's largest health insurers, serving approximately 47 million medical members through its network-based managed care plans.

Elevance Health reported revenues of $50.09 billion, up 12% year on year. This result beat analysts’ expectations by 1.2%. It was a strong quarter as it also recorded a beat of analysts’ EPS and revenue estimates.

The company lost 252,000 customers and ended up with a total of 45.37 million. The stock is down 9.7% since reporting and currently trades at $319.90.

Read our full, actionable report on Elevance Health here, it’s free.

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