Centene (CNC – Research Report), the Healthcare sector company, was revisited by a Wall Street analyst today. Analyst David Windley from Jefferies maintained a Sell rating on the stock and has a $53.00 price target.
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David Windley has given his Sell rating due to a combination of factors reflecting Centene’s financial and operational challenges. One of the primary concerns highlighted is the erratic behavior of segment medical loss ratios (MLRs), which have been influenced by one-time events, creating uncertainty in the company’s financial stability. Furthermore, the company’s Medicaid segment is facing another reset in 2025, and the significant Medicare performance, largely attributed to prescription drug plans, presents challenges in sustainability.
Additionally, the Health Insurance Exchange (HIX) segment is projected to experience flat year-over-year membership growth, with potential declines based on pre-COVID effectuation trends and increased intrayear churn due to changes in enrollment processes and verification measures. Moreover, the 2025 bid process required extensive foresight, but the low visibility and unexpected developments, such as CMS’s actions on agent behaviors and FTR penalties, could negatively impact future performance. These factors combined suggest a cautious outlook for Centene, leading to the Sell rating.
Based on the recent corporate insider activity of 74 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of CNC in relation to earlier this year.