Group 1 - Elevance Health, Inc. (NYSE: ELV) is rated as a Buy despite the severe impact on the healthcare plan providers industry, indicating a contrarian investment stance [1] - The industry has experienced deterioration in market prices, public opinion, and financial results, particularly affecting Elevance [1] - The investment approaches mentioned include GARP (Growth at a Reasonable Price), Value, and Growth, with a focus on insider buying and buybacks, as well as technical analysis tools like Elliott Wave and EMA crossovers [1]

Core Insights - Molina Healthcare, Inc. (MOH) is scheduled to report its second-quarter 2025 results on July 23, 2025, with earnings estimated at $5.56 per share and revenues at $10.84 billion [1][2] Financial Performance - The second-quarter earnings estimate has seen three downward revisions recently, indicating a year-over-year decrease of 5.1% in earnings, while revenues are expected to grow by 9.7% year-over-year [2] - For the full year 2025, the revenue estimate stands at $44.06 billion, reflecting an 8.4% increase year-over-year, but the earnings per share estimate is $22.58, showing a slight decline of 0.3% [5] - Molina Healthcare has beaten consensus estimates in three of the last four quarters, with an average surprise of negative 1.6% [5] Membership and Premiums - The Zacks Consensus Estimate for premiums indicates a growth of 10.1% year-over-year in Q2, with Medicaid premiums expected to grow by 4.1% [7] - Medicaid membership is projected to decrease by 1.2% year-over-year, while Medicare membership is expected to grow by 4.2% [9] - Marketplace membership is anticipated to surge by 63% compared to the previous year [9] Cost and Income Trends - The medical care ratio (MCR) for the Marketplace is expected to rise to 77.49%, up from 71.60% a year ago, while the total MCR is projected at 88.86%, slightly up from 88.60% [9] - Rising costs and lower investment income are contributing to uncertainty regarding an earnings beat, with investment income expected to decline by 12.1% year-over-year [10] - Total operating expenses are predicted to increase by more than 8% from the previous year due to higher medical care costs and general administrative expenses [10] Market Position - The company currently holds a Zacks Rank of 5 (Strong Sell) and an Earnings ESP of -1.09%, indicating a lower likelihood of an earnings beat this quarter [6]

Core Insights - UnitedHealth Group Inc. (UNH) is facing challenges in the healthcare sector, particularly with its Medicare Advantage business under regulatory scrutiny and rising care costs, while its commercial insurance segment is providing stability [1][4] Group 1: Business Performance - As of March 31, 2025, UnitedHealthcare served 50.1 million people, marking a 1.9% year-over-year growth, primarily driven by self-funded commercial benefits [2] - The commercial segment, with over 30 million members, benefits from favorable pricing and a healthier risk pool compared to government plans, showing consistent growth [2][9] - Despite pulling back on full-year guidance due to ongoing pressures, the commercial division continues to act as a buffer against uncertainty in the broader economy [4] Group 2: Leadership and Strategy - Following the return of former CEO Stephen Hemsley in May 2025, the company is focusing on tightening controls and compliance in its Medicare operations while emphasizing growth in its commercial portfolio [3] Group 3: Competitive Landscape - Competitors like Molina Healthcare have warned about rising medical costs, leading to a reduction in their earnings guidance for 2025 [6] - Cigna has strategically sold off its Medicare-related businesses to focus on a commercial-heavy model, which has resulted in impressive first-quarter results driven by premium rate increases [7] Group 4: Valuation and Estimates - UnitedHealth's shares have decreased by 39.9% year-to-date, compared to a 32.3% decline in the industry [8] - The company trades at a forward price-to-earnings ratio of 12.85, above the industry average of 11.5, and has a Value Score of B [10] - The Zacks Consensus Estimate for UnitedHealth's 2025 earnings is $21.85 per share, reflecting a 21% decline from the previous year [12]