Barclays launched its protection of a number of U.S. managed care companies, citing a cautious view on the business, primarily associated to Medicare, the federally backed healthcare program for seniors, the place corporations equivalent to UnitedHealthcare (NYSE:UNH) and Humana (NYSE:HUM) dominate.
Each shares got here beneath strain early this yr, together with their rivals, CVS Well being (CVS) and Alignment Healthcare (ALHC), after the businesses cited a higher-than-expected rise in medical costs during Q4.
“Reimbursement challenges, growing price development, and slowing senior progress make the MA funding case much less compelling now than at any level within the final ten years,” Barclays analyst Andrew Mok wrote.
In February, UNH and HUM shares once more slipped after Medicare’s reimbursement charges for 2025 indicated a 0.2% decline for Medicare Benefit plans and Part D programs.
Nevertheless, Mok has a Impartial business view that’s positively skewed in direction of corporations with an earnings combine uncovered to each business insurance coverage and marketplaces established as a part of the Reasonably priced Care Act (ACA).
“10 years after the ACA was carried out, the Particular person Market is the fastest-growing (+30% y/y) and one of the worthwhile finish markets,” Mok wrote, naming Centene (CNC) and Cigna (CI) as two of Barclay’s greatest concepts. The agency has Chubby scores on the duo, with value targets at $101 and $393 per share, respectively.
Its notable Equal Weight-rated shares embrace CVS (CVS) and Humana (HUM), and the agency is underweight on ALHC, on which it has a $4.50 per share goal. Barclay’s value targets on CVS and HUM are $78 and $356 per share, respectively.
Moreover, Mok launched Medicaid-leveraged Molina Healthcare (MOH) with an Equal Weight score and a $437 goal, arguing that its inventory value already displays “its best-in-class EPS progress outlook,” which he mentioned deserved a “premium valuation.”
In the meantime, UnitedHealth (UNH) and Elevance Well being (ELV) garnered Chubby scores with value targets of $551 and $584 per share, respectively.
“We predict UNH is best-positioned to navigate the complicated Medicare backdrop over a multiyear timeframe,” the analyst added, highlighting Elevance Well being’s (ELV) lack of publicity to the Medicare market to again its bullish thesis.
Extra on Humana, UnitedHealth, and many others.
Barclays launched its protection of a number of U.S. managed care companies, citing a cautious view on the business, primarily associated to Medicare, the federally backed healthcare program for seniors, the place corporations equivalent to UnitedHealthcare (NYSE:UNH) and Humana (NYSE:HUM) dominate.
Each shares got here beneath strain early this yr, together with their rivals, CVS Well being (CVS) and Alignment Healthcare (ALHC), after the businesses cited a higher-than-expected rise in medical costs during Q4.
“Reimbursement challenges, growing price development, and slowing senior progress make the MA funding case much less compelling now than at any level within the final ten years,” Barclays analyst Andrew Mok wrote.
In February, UNH and HUM shares once more slipped after Medicare’s reimbursement charges for 2025 indicated a 0.2% decline for Medicare Benefit plans and Part D programs.
Nevertheless, Mok has a Impartial business view that’s positively skewed in direction of corporations with an earnings combine uncovered to each business insurance coverage and marketplaces established as a part of the Reasonably priced Care Act (ACA).
“10 years after the ACA was carried out, the Particular person Market is the fastest-growing (+30% y/y) and one of the worthwhile finish markets,” Mok wrote, naming Centene (CNC) and Cigna (CI) as two of Barclay’s greatest concepts. The agency has Chubby scores on the duo, with value targets at $101 and $393 per share, respectively.
Its notable Equal Weight-rated shares embrace CVS (CVS) and Humana (HUM), and the agency is underweight on ALHC, on which it has a $4.50 per share goal. Barclay’s value targets on CVS and HUM are $78 and $356 per share, respectively.
Moreover, Mok launched Medicaid-leveraged Molina Healthcare (MOH) with an Equal Weight score and a $437 goal, arguing that its inventory value already displays “its best-in-class EPS progress outlook,” which he mentioned deserved a “premium valuation.”
In the meantime, UnitedHealth (UNH) and Elevance Well being (ELV) garnered Chubby scores with value targets of $551 and $584 per share, respectively.
“We predict UNH is best-positioned to navigate the complicated Medicare backdrop over a multiyear timeframe,” the analyst added, highlighting Elevance Well being’s (ELV) lack of publicity to the Medicare market to again its bullish thesis.