Elevance Health Reports Q3 Results: Surge in Revenue, Earnings Miss
- Elevance Health experienced a 5.3% revenue growth in Q3 2024, reporting $44.7 billion driven by 15% higher Carelon sales.
- The company missed earnings expectations, reducing its 2024 outlook from $37 to $33 per share, amid declining Medicaid membership and persistent high medical costs.
- As a result, the stock fell 14% last week, reflecting significant investor concern about future company performance.
In Q3 2024, Elevance Health, a leading healthcare company in the United States, reported revenues of $44.7 billion, an increase of 5.3% year-over-year, supported by a significant rise in Carelon sales by 15%. However, the company's earnings fell short of expectations, with adjusted earnings per share decreasing to $8.37 from $8.99 in the same quarter last year. As a result, Elevance Health revised its full-year earnings outlook downward to $33 per share from a previous estimate of $37 per share. This decision was largely attributed to anticipated sustained high medical costs and a reduction of its Medicaid membership base, which fell by 1.5 million due to ongoing eligibility redeterminations. Investors reacted negatively to this outlook, leading to a significant drop in stock price. The stock fell by 14% last week, reflecting growing concerns about the company's future performance as medical expenses remain elevated. With current trading around $430, Elevance Health's stock is valued at 13 times its expected earnings in 2024. Over the past three years, the stock's performance has been notably volatile, mirroring the fluctuations of the S&P 500, indicating investor unease moving forward.