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Based in Indianapolis, Indiana, Elevance Health, Inc. (ELV) is a leading force in the healthcare sector, delivering a wide range of health solutions to millions of individuals nationwide. Valued at a market capitalization of $93.4 billion, the company is recognized for its innovative offerings, including medical, pharmacy, behavioral, clinical, and wellness services.
Shares of ELV have underperformed the broader market over the past year. The stock has plunged 16% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 32.1%. In 2024, the stock is down 14.8%, while the SPX has gained 26.2% on a YTD basis.
Narrowing the focus, ELV has trailed the iShares U.S. Healthcare Providers ETF (IHF). The exchange-traded fund has gained 5.5% over the past year and 3.4% on a YTD basis.
Elevance Health has lagged the broader market over the past year due to challenges from declining Medicaid membership, rising expenses, and a debt-laden balance sheet.
On Nov. 12, Elevance Health shares fell by more than 2% after the CFO stated that Medicaid pressure is expected to continue into 2025, and Medicare Advantage margins are projected to miss their 2025 targets.
For the current fiscal year, ending in December, analysts expect ELV’s EPS to decline 0.5% to $32.96 on a diluted basis. The company's earnings surprise history is mixed. It beat the consensus estimate in three of the last four quarters, while missing on another occasion.
Among the 20 analysts covering ELV stock, the consensus rating is a “Strong Buy.” That’s based on 15 “Strong Buy” ratings, two “Moderate Buys,” and three “Holds.”
This consensus is less bullish than three months ago when 16 analysts suggested a “Strong Buy” for the stock.
On Nov. 5, Mizuho Financial Group, Inc. (MFG) analyst Ann Hynes lowered Elevance Health's price target from $585 to $505 while maintaining an “Outperform” rating. The adjustment followed an update to the company's model after its earnings report.
The mean price target of $520.05 represents a 29.4% premium to ELV’s current price levels. The Street-high price target of $625 suggests an upside potential of 55.5%.
