Core Viewpoint - Centene Corp. experienced a significant share price drop of 40% after withdrawing its revenue guidance due to unexpected data from an independent actuary, raising concerns about potential violations of securities laws [1][2][5]. Company Overview - Centene Corp. positions itself as a leading healthcare enterprise, focusing on providing integrated services to government-sponsored and commercial healthcare programs, particularly for under-insured and uninsured individuals [3]. - The company offers products to individuals, including Medicare and Medicaid members, as well as those insured by the Health Insurance Marketplace [3]. Financial Guidance and Adjustments - On April 25, 2025, Centene raised its 2025 revenue guidance by $6 billion and reaffirmed its GAAP diluted EPS guidance floor of greater than $6.19 and adjusted diluted EPS guidance floor of greater than $7.25 [4]. - On July 1, 2025, Centene withdrew its previous guidance, citing new information regarding Health Insurance Marketplace data [5]. Market Data and Implications - The company analyzed initial 2025 industry Marketplace data from Wakely, covering 22 states, which represented approximately 72% of its Marketplace membership [6]. - The analysis revealed that market growth in these states was lower than expected, with significantly higher implied market morbidity than previously assumed, affecting risk adjustment revenue transfer [7]. - Centene estimated a reduction in its full-year net risk adjustment revenue transfer expectation by approximately $1.8 billion, impacting adjusted diluted EPS by about $2.75 [8]. Investor Reaction - Following the announcement of the guidance withdrawal and the negative market data, Centene's share price fell by 40%, equating to a loss of $22.87 per share in a single day [9].

Core Viewpoint - Centene Corp. experienced a significant 40% drop in share price after withdrawing its revenue guidance due to unexpected data from an independent actuary, raising concerns about potential violations of securities laws [1][5][9]. Company Overview - Centene Corp. positions itself as a leading healthcare enterprise, focusing on providing integrated services to government-sponsored and commercial healthcare programs, particularly for under-insured and uninsured individuals [3]. Financial Guidance and Adjustments - On April 25, 2025, Centene had increased its 2025 revenue guidance by $6 billion and reaffirmed its GAAP diluted EPS guidance floor of over $6.19 and adjusted diluted EPS guidance floor of over $7.25 [4]. - On July 1, 2025, Centene withdrew its previous guidance, citing new information regarding Health Insurance Marketplace data [5]. Market Data Analysis - The company analyzed initial 2025 industry Marketplace data from Wakely, covering 22 states, which represented approximately 72% of its Marketplace membership [6]. - The analysis revealed lower-than-expected overall market growth and higher-than-anticipated market morbidity, leading to a reduction in the expected net risk adjustment revenue transfer by approximately $1.8 billion, impacting adjusted diluted EPS by about $2.75 [7][8]. Investor Reaction - Following the announcement of the guidance withdrawal and the negative data, Centene's share price fell by 40%, equating to a loss of $22.87 per share in a single day [9].

Core Viewpoint - Centene has withdrawn its 2025 guidance due to lower-than-expected market growth in over 20 states, impacting its risk adjustment revenue expectations significantly [2][3]. Group 1: Market Analysis - An independent actuarial firm's analysis indicated that the overall market growth in 22 states where Centene operates is lower than anticipated, with morbidity levels being significantly higher than the company's previous assumptions [3]. - The analysis covers 22 of the 29 states where Centene sells individual coverage, representing approximately 72% of the company's marketplace membership [3]. Group 2: Financial Impact - Centene's preliminary analysis suggests a reduction in its full-year net risk adjustment revenue transfer expectation by about $1.8 billion, which translates to an adjusted diluted EPS impact of approximately $2.75 [4]. - The estimate is based on paid claims data through April 30, 2025, and includes projections for the remaining eight months of the year [4]. Group 3: Enrollment Trends - Centene's enrollment in Obamacare increased by 29% to 5.6 million members in the first quarter of the year, up from 4.3 million a year ago, despite a decrease of over 330,000 enrollees in Medicaid coverage [4]. Group 4: Legislative Context - The announcement coincides with the U.S. Senate passing a budget bill that could lead to 11 million Americans losing health insurance coverage, primarily affecting those enrolled in Obamacare and Medicaid, which Centene administers [5]. Group 5: Future Reporting - Centene is currently closing its second quarter and analyzing data, with plans to report its second quarter 2025 results and provide further insights on July 25 [6].