Elevance Health, Inc. (ELV), with a market cap of $89.92 billion, is a leading health benefits company in the United States. Based in Indianapolis, Indiana, ELV offers a variety of health plans and services to individual, employer group risk-based and fee-based members.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and ELV fits right into that category, signifying its substantial size, stability, and dominance in the healthcare plans industry. Elevance Health stands as one of the largest U.S. health insurers, leveraging strong brand equity and extensive market reach. With around 47 million medical members and diverse managed care plans, it has established itself as a trusted health partner.
However, the healthcare titan has fallen 30% from its 52-week high of $567.26, which it hit on September 3. Shares of ELV have declined marginally over the past three months, outperforming the iShares U.S. Healthcare Providers ETF (IHF) 7.1% decline over the same time frame.
Moreover, in the longer term, ELV shares have fallen 29.1% over the past six months and 21.3% over the past 52 weeks. By contrast, IHF has declined 13.6% over the past six months and has surged 4.6% over the past year.
Despite some recent fluctuations, ELV has been trading above its 50-day moving average since the end of January but below its 200-day moving average since early October 2024.
ELV's weak performance over the past year stems from broader challenges in the managed care sector, where reimbursement rate misalignments with rising medical costs have pressured the industry, leading to overall underperformance against the market.
On Jan. 23, the company’s stock surged 2.7% following its Q4 earnings release. ELV announced a 6% increase in its operating revenue, which amounted to $45 billion. Moreover, its EPS came in at $3.84, surpassing the Wall Street EPS estimates by 1.1%.
Meanwhile, in the competitive healthcare plans industry, ELV’s rival, Humana Inc. (HUM), is in the same boat, with its shares falling 29.3% over the past six months and 24.2% over the past 52 weeks.
Nevertheless, Wall Street analysts remain strongly bullish on ELV’s prospects. The stock holds a consensus “Strong Buy” rating from the 20 analysts covering it. The mean target of $485.13 suggests a potential upside of 22.1% from the current market prices.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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