Core Viewpoint - Elevance Health, Inc. reported strong first-quarter 2025 results with adjusted EPS of $11.97, exceeding estimates and showing a year-over-year increase of 10.5% [1][2] Financial Performance - Operating revenues reached $48.8 billion, a 15.4% increase year over year, surpassing consensus estimates by 6% [1][4] - Premiums rose 14.5% year over year to $40.9 billion, exceeding the consensus mark of $38.7 billion [4] - Product revenues increased by 29.1% year over year to $5.8 billion, also beating estimates [4] - Net investment income grew 26.9% year over year to $590 million, surpassing the consensus of $461.3 million [4] - Total expenses were $46.1 billion, up 16.3% year over year, higher than estimates due to increased benefit expenses and operating costs [5] Membership and Operational Update - Medical membership stood at approximately 45.8 million, a 0.5% decline year over year, attributed to Medicaid attrition [3] - The reported membership figure fell short of the Zacks Consensus Estimate of 46.2 million [3] Segment Performance - Health Benefits segment revenues totaled $41.4 billion, an 11.2% year-over-year increase, beating estimates [6] - Carelon segment revenues reached $16.7 billion, a 38% increase year over year, driven by acquisitions and product revenue growth [7] - Corporate & Other segment reported revenues of $165 million with an operating loss of $140 million, wider than the previous year's loss [9] Financial Position - Cash and cash equivalents were $7.5 billion, down from $8.3 billion at the end of 2024 [10] - Total assets increased to $119.7 billion from $116.9 billion at the end of 2024 [10] - Long-term debt decreased to $28.1 billion from $29.2 billion [11] - Total equity grew to $42.6 billion from $41.4 billion at the end of 2024 [11] Capital Deployment - The company repurchased shares worth $880 million in Q1 2025, with $8.4 billion remaining under its buyback authorization [12] - A quarterly dividend of $1.71 per share was paid, totaling $386 million [12] 2025 Outlook - The company reaffirmed adjusted EPS guidance between $34.15 and $34.85, an increase from the 2024 figure of $33.04 [13] - Operating revenues are expected to grow in the high-single to low-double digits from $175.2 billion in 2024 [15] - Medical enrollment is forecasted to be between 45.8 and 46.7 million in 2025 [15]

Membership and Growth - As of March 31, 2025, Elevance Health serves approximately 45.8 million medical members through its affiliated health plans [152]. - The company anticipates continued growth in Public Exchange membership and has expanded into select service areas in Florida, Maryland, and Texas in 2025 [156]. - Total medical membership as of March 31, 2025, was 45,833 thousand, a decline of 216 thousand or 0.5% from March 31, 2024 [187]. - Medicare Advantage membership increased by 238 thousand or 11.8% to 2,255 thousand as of March 31, 2025 [187]. - 53% of Elevance Health's Medicare Advantage members were enrolled in plans rated at least 4.0 Stars or higher for the 2024 Star Ratings [169]. Financial Performance - Total operating revenue for the three months ended March 31, 2025, was $48,765 million, an increase of $6,492 million or 15.4% from the same period in 2024 [182]. - Net income for the three months ended March 31, 2025, was $2,184 million, a decrease of $65 million or 2.9% compared to the same period in 2024 [183]. - Health Benefits operating revenue increased by $4,173 million or 11.2% to $41,431 million, driven by higher premium yields and growth in Medicare Advantage and Individual ACA membership [203]. - CarelonRx operating revenue rose by $2,049 million or 25.4% to $10,116 million, primarily due to higher prescription volume and revenue from recent acquisitions [205]. - Carelon Services operating revenue increased by $2,527 million or 63.0% to $6,536 million, attributed to the acquisition of CareBridge and expansion of risk-based capabilities [206]. - Total operating gain for the three months ended March 31, 2025, was $3,170 million, a $154 million or 5.1% increase from $3,016 million in 2024 [202]. - The operating margin decreased to 6.5% in 2025 from 7.1% in 2024, reflecting a decline of 60 basis points [202]. Cash Flow and Liquidity - Operating cash flow for the three months ended March 31, 2025, was $1,017 million, down from $1,978 million in the same period in 2024 [185]. - Net cash provided by operating activities decreased by $961 million to $1,017 million in 2025, compared to $1,978 million in 2024 [221]. - Total sources of cash for the three months ended March 31, 2025, were $2,196 million, down $1,229 million from $3,425 million in 2024 [221]. - Total uses of cash decreased by $740 million to $2,985 million in 2025, compared to $3,725 million in 2024 [221]. - Cash, cash equivalents, and investments in fixed maturity and equity securities totaled $34,712 million as of March 31, 2025, a decrease of $1,004 million since December 31, 2024 [223]. - The company believes cash on hand and available credit will be adequate to fund expected cash disbursements over the next twelve months [235]. Debt and Capital Structure - The consolidated debt-to-capital ratio was 41.3% as of March 31, 2025, down from 43.0% as of December 31, 2024 [228]. - The company has a senior revolving credit facility of up to $4,000, maturing in April 2027, with no amounts outstanding as of March 31, 2025 [231]. - The company has an authorized commercial paper program of up to $4,000, with no commercial paper outstanding as of March 31, 2025 [232]. - Short-term borrowings from Federal Home Loan Banks were $250 as of March 31, 2025, down from $365 as of December 31, 2024 [233]. - The company intends to maintain its senior debt investment grade ratings, currently rated "A" by S&P and "BBB+" by Fitch [229]. - The company is in compliance with all debt covenants under the 5-Year Facility as of March 31, 2025 [231]. Acquisitions and Investments - Elevance Health completed the acquisition of Centers Plan for Healthy Living LLC and Centers for Specialty Care Group IPA, LLC on December 31, 2024, enhancing its Health Benefits segment [171]. - The acquisition of RSV QOZB LTSS, Inc. (CareBridge) on December 10, 2024, aligns with Carelon Services' strategy for home care management [172]. - The company made an equity investment of $2,580 in Augusta Topco Holdings, L.P. (Mosaic Health), acquiring approximately 35% ownership [173]. - Elevance Health completed the acquisition of Paragon Healthcare, Inc. on March 11, 2024, which provides infusion services and aligns with its care management vision [174]. - The sale of life and disability businesses to StanCorp Financial Group, Inc. on April 1, 2024, resulted in a gain on sale of $201 million [175]. Legal and Regulatory Matters - The company is involved in ongoing litigation related to antitrust claims against the BCBSA and Blue plans, with a settlement agreement amounting to $604 million approved in June 2024 [178]. - The company recognized an estimated payment obligation of $666 million under the Provider Settlement Agreement in September 2024 [179]. - The regulated subsidiaries exceeded all applicable mandatory risk-based capital requirements as of December 31, 2024 [234]. - There have been no material changes to long-term liquidity requirements since December 31, 2024 [236]. Tax and Expense Ratios - The benefit expense ratio increased to 86.4% for the three months ended March 31, 2025, compared to 85.6% for the same period in 2024 [190]. - The effective tax rate decreased to 21.9% for the three months ended March 31, 2025, from 23.5% in the same period in 2024 [190]. - Net investment income increased by $125 million or 26.9% to $590 million for the three months ended March 31, 2025 [190]. - CarelonRx Quarterly Adjusted Scripts increased by 6.9 million or 9.0% to 83.9 million for the three months ended March 31, 2025 [187].

Financial Data and Key Metrics Changes - In Q1 2025, GAAP diluted earnings per share was $9.61, and adjusted diluted earnings per share was $11.97, reflecting year-over-year growth of more than 10% [25] - Operating revenue for the quarter was $48.8 billion, an increase of over 15%, driven by higher premium yields in the health benefits segment and growth in Medicare Advantage and individual ACA membership [26] - The consolidated benefit expense ratio was 86.4%, an increase of 80 basis points year over year, primarily due to higher cost trends in the Medicaid business [27] Business Line Data and Key Metrics Changes - Medicaid business is making progress on rate alignment, with April adjustments coming in as expected [16] - Medicare Advantage performance was consistent with expectations, with strong retention and targeted growth [17] - Health benefits operating gain was $2.2 billion, slightly declining due to higher Medicaid costs, while Calon's operating gain grew 34% to $1.1 billion [29] Market Data and Key Metrics Changes - Individual ACA membership grew approximately 11% sequentially, but a moderation in membership is anticipated in Q2 due to lower effectuation rates [25][56] - The company is expanding into three new states to support broader strategy for coordinated ACA and Medicaid coverage [19] Company Strategy and Development Direction - The company is focused on transforming healthcare experiences to be simpler, more affordable, and more human, with sustained investments in patient advocacy solutions and digital platforms [9][10] - Expansion of value-based oncology care model to Medicare Advantage is planned, following success in the commercial sector [12] - Carillon continues to be a strategic growth engine, significantly expanding relationships with external payers [20] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term outlook for Medicare Advantage, emphasizing strong retention and disciplined growth [17] - Elevated Medicare costs are manageable, with consistent tracking of claims data to identify emerging patterns [39][41] - The company remains disciplined in its approach to benefit design and risk management, ensuring alignment with healthcare needs [129] Other Important Information - The company was named to Fortune's 100 Best Companies to Work For and recognized as one of America's most innovative companies [22] - Operating cash flow totaled $1 billion, with expectations for approximately $8 billion for the year remaining unchanged [32] Q&A Session Summary Question: Medicare Advantage trends and IRA impact - Management indicated that Medicare costs remain elevated but manageable, with no material changes in expectations [39][41] Question: Carillon Services growth and cross-sales - Carillon Services experienced over 60% growth, with strong internal and external expansion [47] Question: Effectuation rates and membership attrition - Membership attrition is projected in the mid-single digit percent range in early Q2, with stabilization expected thereafter [56] Question: Medicaid MLR margin trends - Medicaid trends remain elevated but decelerated as expected, with improvements anticipated in the latter half of the year [117] Question: Part D changes and utilization behavior - Management is comfortable with the mix of Medicare Advantage membership and has not observed substantial variations in utilization [140]

Core Insights - Elevance Health reported $48.77 billion in revenue for Q1 2025, a year-over-year increase of 15.4% and a surprise of +5.95% over the Zacks Consensus Estimate of $46.03 billion [1] - The EPS for the same period was $11.97, compared to $10.64 a year ago, with an EPS surprise of +6.78% against the consensus estimate of $11.21 [1] Revenue and Membership Metrics - Total Medical Membership stood at 45.83 million, slightly below the estimated 46.24 million [4] - Medicaid Medical Membership was 8.86 million, close to the estimate of 8.89 million [4] - Medicare Medical Membership was 876 thousand, exceeding the estimate of 866.49 thousand [4] - Commercial Risk-Based Medical Membership was 3.64 million, below the estimate of 3.75 million [4] Revenue Breakdown - Premium revenues reached $40.89 billion, surpassing the average estimate of $38.70 billion, reflecting a year-over-year change of +14.5% [4] - Service fees totaled $2.07 billion, slightly below the estimate of $2.13 billion, showing a -0.4% change year-over-year [4] - Net investment income was $590 million, exceeding the estimate of $461.32 million, with a year-over-year increase of +26.9% [4] - Product revenue was $5.81 billion, above the estimate of $5.11 billion, representing a +29.1% change year-over-year [4] Operating Revenue Performance - Total operating revenue from Carelon Services was $6.54 billion, exceeding the estimate of $5.87 billion, with a year-over-year change of +63% [4] - CarelonRx generated $10.12 billion in operating revenue, surpassing the estimate of $9.40 billion, reflecting a +25.4% change year-over-year [4] - Health Benefits operating revenue was $41.43 billion, above the estimate of $39.82 billion, with a year-over-year increase of +11.2% [4] - Carelon's total operating revenue was $16.65 billion, exceeding the estimate of $15.27 billion, representing a +37.9% change year-over-year [4]

Elevance Health 1Q 2025 Earnings Presentation April 22, 2025 The Value We Deliver We advance whole health through innovative solutions that integrate physical, behavioral, and social care to achieve our purpose of improving the health of humanity For Consumers Simple, Affordable, and Accessible Health Care For Care Providers Deepen Clinical and Business Partnerships 3 1Q 2025 Results 2 1. Simplifying healthcare through enhanced digital capabilities that personalize member experiences 2. Affordability at the ...

Core Viewpoint - Elevance Health reported quarterly earnings of $11.97 per share, exceeding the Zacks Consensus Estimate of $11.21 per share, and showing an increase from $10.64 per share a year ago, indicating a 6.78% earnings surprise [1][2] Financial Performance - The company achieved revenues of $48.77 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 5.95%, compared to $42.27 billion in the same quarter last year [2] - Over the last four quarters, Elevance Health has exceeded consensus EPS estimates three times and topped revenue estimates four times [2] Stock Performance - Elevance Health shares have increased approximately 10.2% since the beginning of the year, contrasting with a decline of 12.3% in the S&P 500 [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $9.81 on revenues of $47.67 billion, and for the current fiscal year, it is $34.19 on revenues of $192.23 billion [7] - The trend of estimate revisions for Elevance Health is mixed, which may change following the recent earnings report [6] Industry Context - The Medical Services industry, to which Elevance Health belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Financial Performance - 1Q 2025 operating revenue was $48.8 billion, an increase of 15.4% from 1Q 2024[5] - 1Q 2025 adjusted operating gain was $3.3 billion, up 4.1% from 1Q 2024[5] - 1Q 2025 diluted EPS was $9.61; adjusted diluted EPS was $11.97[5] - Total revenues for the three months ended March 31, 2025, increased by 14.8% to $48,891 million compared to $42,577 million in 2024[37] - Premiums rose by 14.5% to $40,887 million, while product revenue increased by 29.1% to $5,809 million[37] - Net income attributable to shareholders decreased by 2.8% to $2,183 million, with earnings per diluted share slightly up by 0.2% to $9.61[37] - Shareholders' net income for Q1 2025 was $2,183 million, a decrease of 2.8% from $2,246 million in Q1 2024[51] - Adjusted shareholders' net income increased by 7.2% to $2,719 million in Q1 2025, compared to $2,537 million in Q1 2024[51] - Operating revenue rose by 15.4% to $48,765 million in Q1 2025, up from $42,273 million in Q1 2024[54] - Reportable segments operating gain increased by 5.1% to $3,170 million in Q1 2025, compared to $3,016 million in Q1 2024[54] - Adjusted shareholders' earnings per diluted share for Q1 2025 was $11.97, reflecting a 10.5% increase from $10.83 in Q1 2024[51] - Full year 2025 outlook for shareholders' earnings per diluted share is projected to be between $28.30 and $29.00[54] Revenue Segments - Health Benefits segment operating revenue was $41.4 billion, an increase of 11% compared to the prior year quarter[15] - Operating revenue from the Health Benefits segment grew by 11.2% to $41,431 million, while Carelon Services saw a significant increase of 63.0% to $6,536 million[44] - Carelon operating revenue was $16.7 billion, an increase of 38% compared to the prior year quarter[21] Expenses and Ratios - The benefit expense ratio was 86.4%, an increase of 80 basis points year over year[9] - Total expenses increased by 16.3% to $46,094 million, with benefit expenses rising by 15.6% to $35,312 million[37] - The operating margin for total operating revenue decreased to 6.5%, down from 7.1% in the previous year[44] - Adjusted operating expense for Q1 2025 was $5,215 million, an increase of 9.2% from $4,776 million in Q1 2024[54] - The operating expense ratio improved to 10.9% in Q1 2025, down from 11.6% in Q1 2024, representing a 70 basis points improvement[54] Cash Flow and Assets - Operating cash flow was $1.0 billion, a decrease of approximately $1.0 billion year over year[11] - The company reported a net cash provided by operating activities of $1,017 million, a decrease from $1,978 million in the prior year[41] - Cash and cash equivalents at the end of the period were $7,500 million, down from $8,288 million at the beginning of the period[41] - The total assets increased to $119,717 million as of March 31, 2025, compared to $116,889 million at the end of 2024[39] Claims and Liabilities - Medical claims payable at the end of the period increased to $16,529 million from $16,183 million[47] Other Financial Metrics - Net losses on financial instruments increased to $464 million in Q1 2025 from $161 million in Q1 2024[51] - Interest expense rose to $344 million in Q1 2025, compared to $265 million in Q1 2024[51] - The company returned $1.3 billion of capital to shareholders in 1Q 2025[5] - The second quarter 2025 dividend was declared at $1.71 per share, payable on June 25, 2025[24]

Core Viewpoint - Elevance Health, Inc. is expected to report first-quarter 2025 results on April 22, with earnings estimated at $11.09 per share, reflecting a 4.2% increase year-over-year, and revenues projected at $46 billion, indicating an 8.7% growth from the previous year [1] Earnings Estimates - The earnings estimate for Q1 has seen three upward revisions in the last 30 days, with no downward movements [1] - The current earnings estimate of $11.09 per share has increased from $10.65 two months ago, showing a trend of positive revisions [2] Earnings Surprise History - Elevance Health has beaten earnings estimates in three of the last four quarters, with an average negative surprise of 2.60% [2] Earnings Prediction Model - The model indicates a likely earnings beat for Elevance Health, supported by a positive Earnings ESP of +4.75% and a Zacks Rank of 3 [3][4] Revenue Drivers - The anticipated growth in results is attributed to higher premiums driven by strong Medicare Advantage membership growth and strength in Carelon businesses [5] - The Zacks Consensus Estimate for premiums is $38.7 billion, reflecting an 8.3% increase year-over-year, while Medicare Advantage membership is expected to grow by 9.8% [6] Segment Performance - The Health Benefits segment is projected to see operating income of $2.2 billion, a decline of 2.5% year-over-year, primarily due to reduced Medicaid membership [8] - The Carelon segment is expected to report operating income of $956 million, indicating a 17.6% year-over-year growth [9] Expense Outlook - Elevated expenses are anticipated due to significant investments in digital capabilities, with total expenses expected to rise by 7.1% year-over-year [10]

Core Viewpoint - Analysts forecast Elevance Health (ELV) to report quarterly earnings of $11.09 per share, reflecting a year-over-year increase of 4.2%, with revenues expected to reach $45.93 billion, an increase of 8.7% compared to the previous year [1]. Earnings Estimates - The consensus EPS estimate has been revised downward by 1.5% over the past 30 days, indicating a collective reassessment by analysts [2]. - Changes in earnings estimates are crucial for predicting investor reactions, as empirical research shows a strong correlation between earnings estimate trends and short-term stock performance [3]. Revenue Projections - Analysts expect 'Revenues- Premiums' to be $38.66 billion, indicating a year-over-year change of +8.3% [4]. - 'Revenues- Service fees' are projected to reach $2.13 billion, reflecting a change of +2.6% from the previous year [5]. - 'Revenues- Net investment income' is expected to be $461.32 million, showing a year-over-year change of -0.8% [5]. - 'Revenues- Product revenue' is anticipated to reach $5.11 billion, indicating a change of +13.6% from the prior year [5]. Membership Metrics - Total Medical Membership is forecasted to be 46.24 million, consistent with the same quarter last year [6]. - 'Medical Membership - Medicare - Medicare Advantage' is expected to reach 2.21 million, up from 2.02 million in the same quarter last year [6]. - 'Medical Membership - Medicaid' is estimated at 8.89 million, down from 9.33 million in the previous year [7]. - 'Medical Membership - Federal Employees Health Benefits' is projected to remain at 1.66 million, unchanged from the year-ago figure [7]. - The consensus for 'Medical Membership - Total Medicare' stands at 3.08 million, up from 2.91 million last year [8]. - 'Medical Membership - Commercial Risk-Based - Individual' is expected to reach 1.42 million, compared to 1.25 million in the same quarter last year [8]. Expense Ratios - The 'Benefit Expense Ratio' is projected to be 87.3%, up from 85.6% in the same quarter last year [9]. - 'Medical Membership - Commercial Fee-Based' is expected to be 27.44 million, slightly down from 27.45 million in the previous year [9]. Stock Performance - Elevance Health shares have increased by +0.4% over the past month, contrasting with the Zacks S&P 500 composite's decline of -4.2% [9].

Core Viewpoint - Elevance Health (ELV) is anticipated to report a year-over-year increase in earnings driven by higher revenues, with the actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The earnings report is scheduled for April 22, 2025, with expectations of quarterly earnings at $11.09 per share, reflecting a +4.2% year-over-year change, and revenues projected at $45.95 billion, an increase of 8.7% from the previous year [3][2]. Estimate Revisions - The consensus EPS estimate has been revised down by 1.46% over the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate for Elevance Health is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +4.75%, suggesting a bullish outlook from analysts [10][11]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive Earnings ESP reading is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [8]. - Elevance Health currently holds a Zacks Rank of 3, indicating a likelihood of beating the consensus EPS estimate [11]. Historical Performance - In the last reported quarter, Elevance Health had an earnings surprise of +1.05%, having beaten consensus EPS estimates three times over the last four quarters [12][13]. Industry Context - Medpace (MEDP), another player in the Zacks Medical Services industry, is expected to report earnings of $3.06 per share, reflecting a -4.4% year-over-year change, with revenues projected at $530.12 million, up 3.7% from the previous year [17]. - Medpace's consensus EPS estimate has been revised down by 1.5% over the last 30 days, resulting in an Earnings ESP of -3.39%, making it challenging to predict a beat on the consensus EPS estimate [18].