In a report released yesterday, David Windley from Jefferies maintained a Sell rating on Oscar Health (OSCR – Research Report), with a price target of $12.00.
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David Windley has given his Sell rating due to a combination of factors affecting Oscar Health’s financial outlook. Primarily, the uncertainty surrounding the company’s earnings for 2025 is fueled by recent misses in the medical loss ratio (MLR) for the fourth quarter and concerns over the newly formed effectuation overhang. The anticipated shifts in risk pools this year make it challenging to confidently support year-over-year MLR improvements in the company’s guidance, especially considering the geographic mix.
Furthermore, while management has defended the mechanics of their 2025 guidance, especially regarding non-utilizer economics and effectuation rates, the economics appear unfavorable. The risk-adjusted pay-in for non-utilizers is significant, and there are concerns about the impact of potential disenrollment due to the expiration of advanced premium tax credits (eAPTC). With visibility for 2025 remaining low and potential turbulence expected in 2026, maintaining a cautious outlook with a Sell rating seems prudent.
In another report released yesterday, Bank of America Securities also reiterated a Sell rating on the stock with a $13.50 price target.
Based on the recent corporate insider activity of 47 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of OSCR in relation to earlier this year.