For the quarter ended March 2025, Molina (MOH) reported revenue of $11.15 billion, up 12.2% over the same period last year. EPS came in at $6.08, compared to $5.73 in the year-ago quarter. The reported revenue represents a surprise of +0.24% over the Zacks Consensus Estimate of $11.12 billion. With the consensus EPS estimate being $5.86, the EPS surprise was +3.75%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expecta ...

Molina (MOH) came out with quarterly earnings of $6.08 per share, beating the Zacks Consensus Estimate of $5.86 per share. This compares to earnings of $5.73 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 3.75%. A quarter ago, it was expected that this provider of Medicaid-related services would post earnings of $5.81 per share when it actually produced earnings of $5.05, delivering a surprise of -13.08%.Over the last four qu ...

"Our first quarter results reflect our team's disciplined approach to medical cost management in an improving rate environment," said Joseph Zubretsky, President and Chief Executive Officer. "Our 2025 earnings and growth profiles are solid, and we remain confident in our ability to achieve our 13% to 15% long-term adjusted EPS growth target." News Release Investor Contact: Jeffrey Geyer, Jeffrey.Geyer@molinahealthcare.com, 305-317-3012 Media Contact: Caroline Zubieta, Caroline.Zubieta@molinahealthcare.com, ...

Healthcare plan provider Molina Healthcare, Inc. (MOH) is set to report first-quarter 2025 results on April 23, 2025, after the closing bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at $5.86 per share on revenues of $11.12 billion. (See the Zacks Earnings Calendar to stay ahead of market-making news.)The first-quarter earnings estimate declined 2.5% over the past 60 days. However, the bottom-line projection indicates a year-over-year increase of 2.3%. The Z ...

Molina (MOH) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended March 2025. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on April 23. On the ...

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Core Viewpoint - Molina Healthcare's fourth-quarter 2024 earnings report showed mixed results, with adjusted EPS missing estimates but total revenues increasing significantly year over year. The company faces challenges from rising medical costs and lower-than-expected membership growth, which may impact future performance [2][3][4]. Financial Performance - Adjusted EPS for Q4 2024 was $5.05, missing the Zacks Consensus Estimate of $5.81, but representing a 15.3% increase from the previous year [2]. - Total revenues reached $10.5 billion, a 16% year-over-year improvement, although it slightly missed consensus expectations [2]. - For the full year 2024, total revenues were $40.65 billion, up from $34.07 billion in 2023, exceeding the estimate of $40.58 billion [4]. Operational Insights - Premium revenues in Q4 2024 were $9.98 billion, a 19.4% increase year over year, surpassing estimates [5]. - Total membership grew by 10.8% year over year to approximately 5.5 million, although it fell short of the Zacks Consensus Estimate by 3.1% [6]. - The consolidated medical care ratio (MCR) was 90.2%, up from 89.1% a year ago, indicating rising medical costs [8]. Expense and Income Analysis - Total operating expenses for Q4 2024 were $10.1 billion, a 15.9% increase year over year, driven by higher medical care costs and administrative expenses [7]. - Investment income decreased by 2.6% year over year to $111 million, but it exceeded the consensus estimate [6]. Future Guidance - For 2025, Molina expects premium revenues to reach around $42 billion, indicating a 9% increase from 2024 [11]. - Adjusted EPS is projected to be at least $24.50, reflecting an 8% rise from the previous year [11]. - Total membership is anticipated to grow to 5.9 million by the end of 2025, with a consolidated MCR expected to remain at 88.7% [12]. Market Position and Trends - The consensus estimate for Molina has seen a downward trend, with a shift of -11.22% in the past month [13]. - The company currently holds a Zacks Rank 4 (Sell), indicating expectations of below-average returns in the near term [15]. - In comparison, Cigna, a competitor in the same industry, reported a revenue increase of 28.4% year over year, highlighting competitive pressures [16].

Financial Performance - Premium revenue for 2024 reached $38,627 million, a 18.9% increase from $32,529 million in 2023[17] - Total revenue for 2024 was $40,650 million, up 19.4% from $34,072 million in 2023[17] - Net income for 2024 was $1,179 million, compared to $1,091 million in 2023, reflecting an 8.0% increase[17] - The company achieved a 19% revenue growth and 12% earnings per share growth from 2019 to 2024[26] - The company targets 11% to 13% revenue growth and 13% to 15% earnings per share growth, aiming for $52 to $55 billion in premium revenue by 2027[27] - The company paid $997 million in total dividends to the parent company in 2024, indicating strong cash flow management[46] - Investment income increased by $58 million in 2024, or 15%, due to growth in invested assets[46] Membership Growth - Membership grew to approximately 5.5 million members in 2024, up from 4.995 million in 2023, representing an 11.0% increase[20] - Medicaid enrollment is expected to increase by over 100,000 in 2025, reaching a total of five million members by year-end[49] - Medicare enrollment is projected to increase by approximately 3% in 2025, totaling 250,000 members, including 39,000 from the ConnectiCare acquisition[65] - Marketplace enrollment is expected to increase by almost 50% in 2025, reaching a total of 580,000 members, contributing to an estimated 60% increase in Marketplace premium revenue[78] - Approximately 1 million new Medicaid members were added since March 31, 2020, but an estimated loss of 675,000 members occurred due to the resumption of redeterminations[88] - The company expects to retain approximately 30% of the membership gained since March 31, 2020[88] Medicaid and Medicare Revenue - Medicaid premium revenue constituted 79% of consolidated premium revenue for the year ended December 31, 2024[52] - California Medicaid contracts generated approximately $4,121 million, or 13% of consolidated Medicaid premium revenue in 2024, with an addition of 500,000 new members[53] - New York Medicaid contracts accounted for approximately $3,373 million, or 11% of consolidated Medicaid premium revenue in 2024[54] - Texas Medicaid contracts represented approximately $4,126 million, or 14% of consolidated Medicaid premium revenue in 2024[55] - For the year ended December 31, 2024, Medicaid program PMPM premium rates ranged from $290 to $1,380[58] - For the year ended December 31, 2024, Medicare program PMPM premium rates ranged from $1,140 to $4,310[73] Acquisitions and Growth Strategy - Recent acquisitions and RFP successes in 2024 are expected to contribute nearly $7 billion in incremental annual premium revenue, mostly realized by 2026[30] - The company closed the acquisition of Bright Health Medicare in January 2024 and ConnectiCare in February 2025, aiming for operational synergies and incremental earnings accretion[158] - The company plans to continue focusing on organic growth through new state procurement opportunities and inorganic growth through accretive acquisitions[28] Regulatory and Compliance Risks - The company is subject to stringent regulatory requirements, which may lead to additional costs for compliance with evolving laws and regulations[122] - The Consolidated Appropriations Act of 2023 allowed states to resume redeterminations, leading to disenrollment of members gained during the PHE[86] - The company is exposed to operating sanctions and financial fines for noncompliance with encounter data submission requirements[184] - Non-compliance with laws regarding PHI, PII, or non-public personal information could lead to civil and criminal penalties, adversely affecting the company's financial condition and operations[204] - New laws and regulations may require significant costs and changes in business operations, potentially hindering growth and leading to legal claims or regulatory investigations[205] Operational Challenges - The company operates with very low profit margins, which are in the single digits, making it sensitive to small changes in operating performance[196] - The company faces risks related to outsourcing services to third parties, which could lead to operational disruptions and increased costs[151] - Cybersecurity threats pose significant risks, including potential data breaches that could harm operations and reputation[152] - The company maintains cybersecurity insurance, but coverage may not be sufficient to cover all financial losses from incidents[155] - Integration of acquired businesses is complex and may not yield anticipated benefits, affecting financial performance[159] Market Competition - Molina Healthcare's Medicaid managed care industry faces increasing competition from large national health plans, with primary competitors including Centene Corporation and CVS Health[118] - The Medicare market is highly competitive, with significant players such as CVS Health Corporation and UnitedHealth Group Inc.[119] Employee Engagement and Benefits - The company is focused on employee engagement and development, with annual surveys showing improvement that exceeds industry benchmarks[134] - Molina Healthcare offers a comprehensive suite of employee benefits, including health insurance, 401(k) matching, and wellness programs[138] Financial Risks - A substantial portion of premium revenue is subject to complex contract provisions, which, if misinterpreted, could require adjustments that negatively impact financial results[164] - Medicaid premium revenues may be adversely affected by retroactive adjustments or delays in rate changes by states, creating uncertainty in revenue recognition[166] - Loss of significant contracts could lead to stranded administrative costs, adversely affecting the company's financial condition and cash flows[163] - The company's medical care ratio was 89.1% for the year ended December 31, 2024; a one percentage point increase could have reduced net income per diluted share by approximately $5.24[171] - The company relies on state-provided eligibility lists for premium payments, and inaccuracies could lead to reimbursement obligations that adversely affect results[178] Future Outlook - The economic impact of transitioning from MMPs to D-SNPs by January 1, 2026, remains uncertain for premium revenue[192] - Changes in laws and regulations could impose additional capital requirements and increase administrative costs, negatively impacting profitability[212] - Rising pharmaceutical costs, including new specialty drugs, could jeopardize the actuarial soundness of capitation rates, adversely impacting financial results[207] - Large-scale medical emergencies could significantly increase utilization rates and medical costs, negatively affecting the company's financial condition[208]

Core Insights - Molina Healthcare, Inc. reported fourth-quarter 2024 adjusted EPS of $5.05, missing the Zacks Consensus Estimate of $5.81, but reflecting a 15.3% year-over-year growth [1] - Total revenues for the quarter reached $10.5 billion, a 16% increase year-over-year, although it slightly missed the consensus mark [1][2] Financial Performance - Full-year 2024 total revenues were $40.65 billion, up from $34.07 billion the previous year, surpassing the estimate of $40.58 billion [3] - Adjusted EPS for 2024 grew to $22.65 from $20.88, but fell short of the consensus estimate of $23.44 [3] - Adjusted net income for 2024 was $1.31 billion, an increase from $1.21 billion year-over-year [3] Operational Highlights - Premium revenues in Q4 2024 were $9.98 billion, a 19.4% increase year-over-year, exceeding the Zacks Consensus Estimate of $9.85 billion [4] - Total membership as of December 31, 2024, rose 10.8% year-over-year to approximately 5.5 million, although it missed the consensus estimate by 3.1% [5] - Investment income decreased by 2.6% year-over-year to $111 million, but was above the consensus mark of $108.2 million [5] Expense and Ratios - Total operating expenses for Q4 2024 were $10.1 billion, a 15.9% increase year-over-year, exceeding model estimates due to rising medical care costs and higher administrative expenses [6] - The consolidated medical care ratio (MCR) was 90.2% for the quarter, up from 89.1% a year ago, and higher than the consensus mark of 88.72% [7] Balance Sheet and Cash Flow - As of December 31, 2024, cash and cash equivalents were $4.66 billion, down from $4.85 billion at the end of 2023 [8] - Total assets increased to $15.63 billion from $14.89 billion at the end of 2023, while long-term debt rose to $2.92 billion from $2.18 billion [8] - Net cash provided by operating activities was $644 million in 2024, a significant decline from $1.66 billion in 2023 [9] 2025 Guidance - Management projects premium revenues to reach around $42 billion in 2025, indicating a 9% improvement from 2024 [11] - Adjusted EPS is expected to be at least $24.50, reflecting an 8% increase from 2024 [11] - Total membership is estimated to grow to 5.9 million by the end of 2025, with a projected consolidated MCR of 88.7% [12]

Financial Data and Key Metrics Changes - The company reported adjusted earnings per share of $5.05 on $10 billion of premium revenue for Q4 2024, with full-year adjusted earnings per share of $22.65, representing an 8.5% year-over-year growth [10][12][34] - Full-year premium revenue reached $38.6 billion, reflecting a 19% year-over-year growth, while the pretax margin was 4.3%, within the long-term target range [13][14] - The consolidated Net Cost Ratio (NCR) for Q4 was 90.2%, higher than expected due to medical cost pressures, with a full-year NCR of 89.1% [11][63] Business Line Data and Key Metrics Changes - In Medicaid, the full-year MCR was 90.3%, or 89.8% when adjusted for prior year items, with a Q4 MCR also at 90.2% due to higher utilization [14][63] - Medicare's full-year MCR was 89.1%, with Q4 MCR at 93.8%, reflecting higher medical costs [19][67] - Marketplace performed well with a full-year MCR of 75.4%, significantly below the long-term target range, allowing for reinvestment into pricing for growth [20][69] Market Data and Key Metrics Changes - The company expects to end 2025 with approximately 5 million Medicaid members, 250,000 Medicare members, and 580,000 Marketplace members, reflecting significant growth [75][78] - The 2025 premium revenue guidance is approximately $42 billion, representing about 9% growth from 2024 [79] Company Strategy and Development Direction - The company is focused on growth initiatives, including recent acquisitions and new contract wins, projecting a path to $46 billion in premium revenue by 2026 and at least $52 billion by 2027 [28][31] - The company aims to maintain a solid earnings profile with embedded earnings projected to reach $7.75 for 2026 and beyond, supporting future EPS growth [31][88] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that Q4 results fell short of expectations but emphasized the ability to manage through industry-wide headwinds [53][56] - The company remains confident in achieving long-term targets and believes that any changes to the Medicaid program will be marginal [47][51] Other Important Information - The company closed its acquisition of Connecticut from EmblemHealth, expected to generate $1.2 billion in revenue, primarily in Marketplace [22] - The company repurchased 1.7 million shares at a total cost of $500 million and closed a bond offering of $750 million [72] Q&A Session Summary Question: Can you provide more color on the components within the Medicaid MLR for 2025? - Management indicated that the MLR guidance for 2025 is flat with 2024, projecting a 4.5% rate increase and a 4.5% trend off the 2024 baseline [92][93] Question: What were the specific drivers for the Marketplace MLR in Q4? - Management attributed the Q4 Marketplace MCR of 83.3% to normal seasonality, noting that the full-year MCR of 75.4% was satisfactory [122] Question: Can you clarify the cost trends and what drives the assumptions for 2025? - Management explained that the 2024 cost trend was 6.5%, while the 2025 projection is 4.5%, reflecting a more stable utilization trend without the acuity shift seen in 2024 [135][136]