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Elevance Health (ELV)
NYSE:ELV
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Elevance Health
(NYSE:ELV)72Outperform
Positive Factors
Earnings
ELV reported slightly better results than feared with adjusted EPS of $3.84 beating consensus of $3.81 by nearly 1%.
Medicare Advantage Growth
Elevance Health expects to achieve 7 to 9% growth in Medicare Advantage through strong member retention and contract wins.
Negative Factors
Medicaid Cost Trend
Medicaid challenges are pressuring the cost trend, with core MLR increasing 290bps year-over-year.
Elevance Health (ELV) vs. S&P 500 (SPY)
Market Cap
$91.57B
Dividend Yield1.59%
Average Volume (3M)1.46M
Price to Earnings (P/E)15.7
Beta (1Y)0.23
Revenue Growth3.19%
EPS Growth1.65%
CountryUS
Employees104,200
SectorHealthcare
Sector Strength74
IndustryMedical Service Plans
Share Statistics
EPS (TTM)25.61
Shares Outstanding227,351,870
10 Day Avg. Volume1,551,875
30 Day Avg. Volume1,461,882
Financial Highlights & Ratios
PEG Ratio9.50
Price to Book (P/B)N/A
Price to Sales (P/S)0.52
Price to Cash Flow (P/CF)32.40
P/FCF Ratio32.40
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$472.38Price Target Upside15.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
Elevance Health Business Overview & Revenue Model
Company DescriptionElevance Health (ELV) is a leading American health insurance and managed care provider, primarily operating within the healthcare sector. The company offers a wide range of health-related services and products, including individual, group, and government-sponsored insurance plans, as well as pharmacy benefits management and healthcare services. Elevance Health is committed to improving health outcomes by leveraging its extensive network of healthcare professionals and innovative solutions.
How the Company Makes MoneyElevance Health generates revenue primarily through the sale of health insurance plans and related services. Its key revenue streams include premiums collected from individual and group insurance plans, which are offered to both private and government-sponsored programs such as Medicare and Medicaid. Additionally, the company earns money through its pharmacy benefits management services, which involve negotiating drug prices and managing prescription drug benefits for its members. Partnerships with healthcare providers and other stakeholders also play a crucial role in enhancing its service offerings and expanding its customer base, thereby contributing to its overall earnings.
Elevance Health Financial Statement Overview
Summary
Elevance Health demonstrates strong financial performance with consistent revenue growth and stable profitability. While the balance sheet is robust, the declining cash flows warrant attention to maintain financial flexibility. Overall, the company is in a healthy financial state, with room for improvement in cash flow management.Income Statement
Elevance Health shows strong revenue growth with a significant increase from $104.2 billion in 2019 to $177 billion in 2024, indicating a robust upward trend. The gross profit margin has improved over the years, and the net profit margin is stable, reflecting efficient cost management. However, the EBITDA margin is unavailable for 2024, which could provide more insights into operational efficiency.85
Very Positive
Balance Sheet
The balance sheet reflects a solid financial position with a steady increase in stockholders' equity and total assets. The debt-to-equity ratio remains manageable, suggesting prudent leverage levels. However, the decrease in cash and cash equivalents from 2023 to 2024 may need monitoring for future liquidity concerns.78
Positive
Cash Flow
Elevance Health's cash flow from operations remains positive, although it has decreased in 2024 compared to previous years. The free cash flow shows a declining trend, which may impact future investment capabilities. Despite this, the operating cash flow to net income ratio is reasonable, affirming cash generation efficiency relative to net income.72
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 176.81B | 171.34B | 156.59B | 138.64B | 121.87B | Gross Profit |
| 157.06B | 47.01B | 39.95B | 35.99B | 33.82B | EBIT |
| 137.24B | 8.74B | 8.45B | 8.95B | 7.71B | EBITDA |
| 0.00 | 10.49B | 10.13B | 6.00B | 8.18B | Net Income Common Stockholders |
| 5.98B | 5.99B | 5.89B | 6.10B | 4.57B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 8.29B | 36.14B | 7.39B | 31.15B | 29.17B | Total Assets |
| 116.67B | 108.93B | 102.77B | 97.31B | 86.61B | Total Debt |
| 29.22B | 25.12B | 24.11B | 23.03B | 20.04B | Net Debt |
| 20.93B | 18.59B | 16.73B | 18.15B | 14.29B | Total Liabilities |
| 75.25B | 69.52B | 66.38B | 61.18B | 53.42B | Stockholders Equity |
| 41.31B | 39.31B | 36.31B | 36.06B | 33.20B |
| Cash Flow | Free Cash Flow | |||
| 4.55B | 6.76B | 7.25B | 7.28B | 9.67B | Operating Cash Flow |
| 5.81B | 8.06B | 8.40B | 8.36B | 10.69B | Investing Cash Flow |
| -5.17B | -5.57B | -4.56B | -9.64B | -7.32B | Financing Cash Flow |
| 1.19B | -3.35B | -1.32B | 423.00M | -2.57B |
Elevance Health Technical Analysis
Positive
409.46
Price Trends
389.85
Positive
400.08
Positive
463.91
Negative
Market Momentum
2.67
Negative
61.05
Neutral
85.59
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ELV, the sentiment is Positive. The current price of 409.46 is above the 20-day moving average (MA) of 393.03, above the 50-day MA of 389.85, and below the 200-day MA of 463.91, indicating a neutral trend. The MACD of 2.67 indicates Negative momentum. The RSI at 61.05 is Neutral, neither overbought nor oversold. The STOCH value of 85.59 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ELV.
Elevance Health Risk Analysis
Elevance Health disclosed 26 risk factors in its most recent earnings report. Elevance Health reported the most risks in the “Ability to Sell” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Elevance Health Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $80.74B | 29.53 | 51.23% | 0.41% | 14.29% | -1.20% | |
76 Outperform | $82.27B | 17.85 | 6.07% | 4.01% | 4.02% | -43.51% | |
72 Outperform | $91.57B | 15.69 | 14.83% | 1.59% | 3.19% | 1.65% | |
70 Outperform | $87.86B | 26.48 | 7.87% | 1.74% | 25.19% | ― | |
67 Neutral | $31.34B | 26.01 | 7.40% | 1.36% | 10.70% | -49.85% | |
65 Neutral | $451.39B | 31.83 | 15.88% | 1.66% | 8.35% | -35.14% | |
49 Neutral | $7.05B | 0.34 | -55.09% | 2.46% | 25.27% | -3.43% |
* Healthcare Sector Average
Performance Comparison
ELV
Elevance Health
409.46
-92.23
-18.38%
CI
Cigna
321.02
-15.47
-4.60%
CVS
CVS Health
66.33
-6.30
-8.67%
HUM
Humana
259.76
-83.36
-24.29%
MCK
McKesson
644.22
119.98
22.89%
UNH
UnitedHealth
493.48
9.97
2.06%
Elevance Health Earnings Call Summary
Earnings Call Date: Jan 23, 2025 | % Change Since: 4.79% | Next Earnings Date: Apr 16, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed sentiment with strong growth in Medicare Advantage and commercial businesses, alongside challenges in Medicaid cost trends and membership reductions. The company is confident in navigating these challenges and executing growth strategies.Highlights
Medicare Advantage Growth
Medicare Advantage membership is expected to grow in the range of 7% to 9%, consistent with prior expectations, with strong member retention and group membership growth.
Strong Commercial Business Performance
Elevance Health welcomed 18 new national accounts and experienced record retention for 2025, contributing to strong revenue growth in the commercial segment.
Carelon Services Growth
Carelon Services experienced impressive growth with internal and external expansion, reaching over 50% growth, driven by acquisitions like CareBridge and strong organic growth.
Adjusted EPS Guidance for 2025
Guidance for adjusted diluted earnings per share is set at $34.15 to $34.85, with a focus on managing cost trends and executing growth opportunities.
Lowlights
Elevated Medicaid Cost Trends
Fourth quarter Medicaid cost trends remained elevated, driven by behavioral health and inpatient services, with current rates not fully covering these costs.
Reduction in Membership
Total membership decreased by 1.1 million year-over-year, primarily due to Medicaid redeterminations and changes in geographic footprint.
Challenges with Medicaid Rates
Medicaid rates remain insufficient to cover elevated cost trends, with expectations for improvement in the second half of 2025 as rate adjustments from state partners are implemented.
Company Guidance
During the Elevance Health fourth-quarter earnings call for 2024, key guidance metrics were highlighted, with adjusted diluted earnings per share projected to be in the range of $34.15 to $34.85 for 2025. The company anticipates Medicare Advantage membership growth between 7% to 9%, consistent with prior expectations. The Medicaid business faced elevated cost trends, with a focus on improving margins through anticipated rate adjustments in the latter half of 2025. Elevance Health expects operating revenue growth in the high single to low double-digit range, bolstered by acquisitions such as CareBridge. Furthermore, the consolidated medical loss ratio is projected to increase to around 89.1%, and the adjusted operating expense ratio is expected to slightly improve to 10.4%. The company plans to allocate approximately $2.3 billion toward share repurchases, reflecting a strong commitment to shareholder returns.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.