Most major U.S. managed care insurers set for sequential earnings declines in Q2

An analysis of consensus analyst estimates for Q2 suggests that most U.S. health insurers are set for sequential bottom-line declines.

Of the nine largest U.S. managed care insurers, only Alignment Healthcare (ALHC) is expected to report an improvement in EPS from Q1. On a Y/Y basis, six of the nine are expected to see earnings growth.

The increasing costs associated with Medicare Advantage plans have continued to put pressure on insurers’ balance sheets. Centene (CNC) and Humana (HUM) have both projected sequential and Y/Y declines in EPS amid headwinds associated with Medicare Advantage and Medicaid plans.

Industry bellwether UnitedHealth Group (UNH) has already posted around 2% Q/Q decline in adjusted earnings amid a rise in medical costs, even though topline expanded on a Y/Y basis.

Here is a look at the consensus estimates of the other eight major publicly traded U.S. insurers versus their Q1 EPS:

• Cigna (CI) Q2 estimate $6.45 (vs EPS actual $6.47 in Q1)
• Elevance Health (ELV) Q2 estimate $10.01 (vs EPS actual $10.64 in Q1)
• Centene (CNC) Q2 estimate $1.96 (vs EPS actual $2.26 in Q1)
• Humana (HUM) Q2 estimate $5.87 (vs EPS actual $7.23 in Q1)
• Molina Healthcare (MOH) Q2 estimate $5.71 (vs EPS actual $5.73 in Q1)
• Oscar Health (OSCR) Q2 estimate $0.16 (vs EPS actual $0.62 in Q1)
• Clover Health Investments (CLOV) Q2 estimate -$0.05 (vs EPS actual -$0.04 in Q1)
• Alignment Healthcare (ALHC) Q2 estimate -$0.08 (vs EPS actual -$0.12 in Q1)