Elevance Health (NYSE: ELV) is trading near $339, down from a 52-week high of $567. That’s a 40% slide in less than six months. The stock is under pressure from multiple angles. Medicaid cost inflation, sector-wide guidance withdrawals, and pending litigation have all weighed on sentiment.
The company reports Q2 earnings on July 17. Analysts expect $9.20 EPS on $48.13 billion in revenue. That’s a 9.1% decline in earnings and an 11.4% increase in revenue year-over-year. The benefit expense ratio is projected to rise to 88.4%, up from 86.3% last year. Medicaid membership is expected to fall to 8.86 million, down from 9.03 million. Commercial risk-based membership is forecast to rise slightly to 5 million.
Bernstein maintains a Buy rating with a $585 price target. Wells Fargo holds at $478. But the market isn’t buying it yet. Shares dropped 11.4% over the past month. Centene’s guidance withdrawal triggered a sector-wide selloff. Molina cut its 2025 EPS outlook by 12%. UnitedHealth delayed its Q2 report to July 29. Elevance is now the first major insurer to report.
Litigation risk is rising. A securities fraud class action was filed in July, alleging that Elevance misrepresented Medicaid cost trends during the redetermination period. The complaint cites missed EPS targets and lowered guidance in 2024. The deadline to join the suit passed on July 11.
Despite the pressure, Elevance reaffirmed its full-year EPS range of $34.15 to $34.85. Operating revenue rose 15.4% in Q1 to $48.8 billion. Adjusted operating gain hit $3.3 billion. The company returned $1.3 billion to shareholders last quarter. Telehealth usage topped 800,000 visits in 2023. The CarelonRx and Carelon Services segments continue to expand.
Elevance is still a dominant player in managed care. But the Medicaid drag and litigation cloud are real. Q2 results will set the tone. If earnings hold and cost ratios stabilize, the rebound could begin. If not, the slide may deepen.
Sources:
https://www.tmcnet.com/usubmit/2025/07/08/10220609.htm
NOTE: This is not financial advice. Please conduct your own due diligence.