Molina Healthcare, Inc. (MOH), headquartered in Long Beach, California, runs managed care plans for low-income families and individuals via Medicaid and Medicare programs. It delivers community-focused health services across various U.S. states. The company has a market capitalization of $7.78 billion. Rising costs in the Medicaid and Medicare segments, alongside the Trump administration’s changes to the Affordable Care Act (ACA), have led Molina’s stock to decline. Over the past 52 weeks, the stock has ...

Core Viewpoint - Molina Healthcare Inc. experienced a significant stock decline following a fourth-quarter earnings miss, reporting an unexpected adjusted loss of $2.75 per share compared to Wall Street's expectation of a profit of $0.34, leading to a more than 30% drop in stock price in a single session [2][4]. Financial Performance - The fourth-quarter loss was primarily due to $2.00 per share in unfavorable retroactive revenue adjustments in California and rising medical costs in Medicare and Marketplace segments [5]. - The stock is down 24.16% year-to-date, with a 49.60% decline over the past year, while the S&P 500 has only decreased by 0.33% during the same period [6]. Technical Indicators - Following the earnings report, Molina's stock momentum score fell from 14.04 to 5.72, indicating a significant deterioration in technical indicators [3]. - The stock maintains a weaker price trend across long, short, and medium terms, despite having a strong value ranking according to Benzinga's Edge Stock Rankings [3]. Investor Sentiment - Michael Burry, known for his "Big Short" investment strategy, has reaffirmed a contrarian position in Molina, despite facing a 27% loss on his estimated purchase price, arguing that the market's reaction is excessively negative [4]. Future Outlook - CEO Joseph Zubretsky has described 2026 as a "trough year" for margins, projecting an adjusted EPS of at least $5.00, which is significantly lower than previous forecasts, as the company transitions away from traditional Medicare Advantage products [5].

Group 1 - Molina Healthcare Inc. (NYSE:MOH) is considered one of the most undervalued mid-cap stocks currently available for investment [1] - Goldman Sachs lowered its price target for Molina Healthcare to $124 from $167 while maintaining a Neutral rating after the company's Q4 2025 earnings miss [1][4] - UBS analyst AJ Rice also reduced the price target for Molina Healthcare to $145 from $170, citing challenges in the Medicaid and exchanges backdrop while keeping a Neutral rating [3] Group 2 - The return profiles for strong operators in low-margin, government-priced cyclical businesses, such as managed care organizations, can diminish rapidly during economic downturns [2] - Goldman Sachs anticipates that challenges in the managed care sector will persist due to its sensitivity to the current cyclical environment [2]

Financial Performance - Molina Healthcare reported premium revenue of $43,052 million for the year ended December 31, 2025, an increase of 11.7% from $38,627 million in 2024[18]. - Total revenue for Molina Healthcare reached $45,426 million in 2025, up from $40,650 million in 2024, reflecting a growth of 11.7%[18]. - Net income decreased to $472 million in 2025 from $1,179 million in 2024, resulting in a net income per diluted share of $8.92 compared to $20.42 in the previous year[18]. - Medicaid premium revenue constituted 75% of the company's consolidated premium revenue for the year ended December 31, 2025[148]. - The company's overall medical care ratio was 91.7% for the year ended December 31, 2025; a one percentage point increase would have reduced net income per diluted share from $8.92 to $2.72, a difference of $6.20[145]. Membership and Enrollment - Molina Healthcare's total membership as of December 31, 2025, was approximately 5.5 million, a slight decrease from 5.5 million in 2024, with Medicaid membership declining to 4,568,000[21]. - The company anticipates a 15% to 20% reduction in Medicaid Expansion membership due to the One Big Beautiful Bill Act (OBBBA) over the next two to three years[27]. - Expected Medicare enrollment decrease of approximately 12% in 2026, totaling 230,000 members, including 80,000 Medicare Advantage-Part D members[57]. - Marketplace enrollment expected to decrease to approximately 220,000 members by the end of 2026, representing an estimated premium revenue decrease of approximately 50%[70]. - The company estimates a reduction in Medicaid enrollment of 15% to 20% by 2029, affecting approximately 1.2 million members in its Medicaid Expansion population[77]. Strategic Initiatives - Molina Healthcare's strategic plan includes a long-term premium revenue growth target of 11% to 13%, aiming to surpass $50 billion in premium revenue by 2027[33]. - The company completed the acquisition of ConnectiCare for $350 million, which is expected to contribute approximately $9 billion in incremental annual premium revenue[37][28]. - Company is focused on operational restructuring and enrollment alignment to support long-term growth opportunities in the dual eligible market[56]. - The company’s growth strategy includes targeted acquisitions, but successful integration and realization of anticipated benefits are complex and uncertain[160]. Regulatory and Compliance - The company is subject to stringent regulatory capital requirements that limit its ability to pay dividends[129]. - The company has implemented HIPAA compliance programs to ensure adherence to privacy and security regulations, which may incur additional costs[121]. - The company is subject to extensive fraud and abuse laws, which may result in significant fines, civil penalties, or other sanctions[198]. - The company is subject to various federal and state data privacy laws, including HIPAA and the CCPA, which impose significant compliance obligations[210]. Market Competition - The company faces significant competition in the Medicaid market from organizations like Centene Corporation and UnitedHealth Group Inc., impacting contract retention and member acquisition[114]. - The Medicare market is highly competitive, with major competitors including CVS Health Corporation and Humana, influencing pricing and bid strategies[116]. Operational Risks - The company is exposed to cybersecurity risks that could result in operational impacts and significant legal liabilities[154]. - The company may face cyberattacks and incidents that could adversely impact operations and financial results, although no material incidents have occurred to date[158]. - The company is vulnerable to operational disruptions if third-party vendors fail to perform adequately[182]. - The company faces risks related to the accuracy and completeness of encounter data, which is critical for compliance and premium rate determination[184]. Healthcare Costs and Pricing - The medical care costs are influenced by various factors, including hospital costs, pharmacy costs, and changes in healthcare regulations[149]. - The introduction of new high-cost specialty drugs and sudden cost spikes for existing drugs could jeopardize the actuarial soundness of the company's capitation rates[214]. - The unpredictable nature of pharmaceutical costs, including geographic variations and changes in discounts, may materially affect the company's financial results[213]. Employee Engagement and Benefits - Employee engagement survey results indicate continued high levels of engagement that exceed industry benchmarks[132]. - The company offers a comprehensive suite of benefits, including 401(k) matching contributions and paid parental leave, to attract and retain talent[138].

Core Viewpoint - Molina Healthcare is facing legal scrutiny while maintaining a robust market presence, with a new price target suggesting potential growth despite challenges [2][3][5]. Group 1: Company Overview - Molina Healthcare (NYSE: MOH) provides managed health care services under Medicaid and Medicare programs, targeting low-income families and individuals across several U.S. states [1]. - The company competes with major players like UnitedHealth Group and Centene Corporation [1]. Group 2: Stock Performance - As of the latest data, Molina's stock is priced at $127.53, reflecting a decrease of 3.18% or $4.19 [4][6]. - The stock has shown significant volatility, with a daily trading range between $123.73 and $135.94, and a yearly high of $359.97 and low of $123.73 [4]. Group 3: Market Capitalization and Trading Activity - Molina Healthcare has a market capitalization of approximately $6.56 billion, indicating its substantial size and market presence [5]. - The trading volume for the day is reported at 4,660,173 shares on the NYSE, suggesting active investor interest despite ongoing legal challenges [5]. Group 4: Analyst Insights - Andrew Mok from Barclays has set a new price target for Molina Healthcare at $133, indicating a potential increase of 4.29% from the current stock price [2][6]. Group 5: Legal Issues - Grabar Law Office is investigating potential breaches of fiduciary duties by Molina's officers and directors, linked to a securities fraud class action complaint regarding undisclosed adverse facts about its "medical cost trend assumptions" [3][6].

Core Viewpoint - Grabar Law Office is investigating claims on behalf of shareholders of Molina Healthcare, Inc. regarding potential breaches of fiduciary duties by certain officers and directors of the company [1]. Group 1: Investigation Details - The investigation is focused on whether Molina Healthcare's officers and directors failed to disclose material adverse facts related to the company's financial health, specifically concerning "medical cost trend assumptions" and a "dislocation between premium rates and medical cost" [3]. - Allegations include that Molina Healthcare's near-term growth relied on a lack of utilization of various health services, which could lead to a significant reduction in the company's financial guidance for fiscal year 2025 [3]. Group 2: Shareholder Actions - Shareholders who purchased Molina Healthcare shares prior to February 5, 2025, and still hold them can seek corporate reforms, the return of funds to the company, and a court-approved incentive award at no cost [2][4]. - Interested shareholders are encouraged to contact Grabar Law Office for more information on how to proceed with their claims [2][4]. Group 3: Law Firm Background - Grabar Law Office is recognized for its extensive experience in complex commercial litigation, particularly in securities class actions and individual shareholder litigation under federal and state laws [5]. - The firm has a strong reputation, with its lawyers rated for high levels of professional excellence and ethical standing [5].

Core Insights - Molina Healthcare (MOH) is a dedicated health insurance company facing margin pressure due to claims inflation [1] Company Performance - Molina reported its Q4 2025 results, indicating ongoing challenges in maintaining profitability amidst rising claims costs [1]

Core Viewpoint - Molina Healthcare is facing margin pressure due to claims inflation, which is a common challenge in the health insurance sector [1]. Company Summary - Molina Healthcare (MOH) is identified as a pure play health insurance company [1]. - The company recently released its Q4 2025 results, indicating ongoing struggles within the industry [1]. Industry Summary - The health insurance sector is experiencing significant margin pressure attributed to rising claims inflation, affecting multiple players in the market [1].

Core Viewpoint - Molina Healthcare's shares plummeted over 25% following disappointing guidance for fiscal 2026, with earnings projected at $5 per share, significantly lower than the previous estimate of approximately $14 [1]. Group 1: Stock Performance - Year-to-date, Molina Healthcare's stock has declined nearly 35% from its high [2]. - The stock is currently trading below its major moving averages, indicating a broader downward trend [7]. Group 2: Financial Guidance and Market Reaction - The company anticipates an elevated medical cost ratio for the year, contributing to the lowered earnings guidance [1]. - Despite the sharp decline, investor Michael Burry remains optimistic about his investment in Molina, comparing it to Berkshire Hathaway's investment in Geico [4]. Group 3: Investment Considerations - Molina Healthcare is currently trading at a discount to its intrinsic value, but faces increased pressure from proposed reductions in Medicare Advantage reimbursement rates, making it a high-risk investment [5]. - Unlike competitors such as UnitedHealth and Humana, Molina does not pay a dividend, making it less attractive for income-focused investors [5]. - Options traders express skepticism about the stock's recovery, with predictions indicating a potential further decline of 20% over the next five months [7]. Group 4: Analyst Perspectives - Wall Street analysts suggest that the recent selloff in Molina shares may have been excessive, indicating potential for recovery despite the associated risks [9].

Company Performance - Molina Healthcare Inc. (NYSE:MOH) experienced a significant decline of 29%, marking its worst trading session since 2012, following an unexpected quarterly loss and a weak earnings outlook for 2026 [2] Market Context - Despite the overall rally in Wall Street indices, with the Dow Jones Industrial Average rising nearly 2% to a new all-time high of 49,870 points, small-cap stocks outperformed large-cap indices, as evidenced by the Russell 2000 soaring more than 3% [1] - The S&P 500 and Nasdaq 100 also saw gains of approximately 1.6% [1] Commodity Market - Gold prices increased by 3.8%, reaching $4,960 per ounce, while silver surged by 8% to $77 per ounce, indicating a strong performance in the commodity market [2]