Elevance drags managed care rivals to trail S&P 500 after 2Q earnings

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Elevance Health (NYSE:ELV), formerly known as Anthem, led a selloff among managed care players despite reporting better than expected financials for 2Q 2022 before the opening bell on Wednesday.

Recording the sharpest intraday loss since March 2020, Elevance (ELV) currently stands as the worst performer in the S&P 500. Its rivals, UnitedHealth Group (UNH), Cigna Corporation (CI), Humana (HUM), CVS Health Corp (CVS), and Centene Corp (CNC), are not far behind,

Elevance (ELV), the number two Medicaid insurer in the U.S., reported $33.1B in revenue for the quarter with ~16% YoY growth driven by higher premium revenue. Even quarterly adjusted earnings per share climbed ~14% YoY to $8.04 despite a 20 basis-point increase in the benefit-expense ratio, which stood at ~87%.

After raising adj. EPS guidance to $28.70, Elevance (ELV) Chief Financial Officer John Gallina noted during the earnings call: “We expect the cost structure for health plans to remain somewhat elevated in the back half of the year, which is reflected in our guidance.”

While the company exceeded Street forecasts for the medical loss ratio, Evercore ISI analyst Michael Newshel, with an outperform rating on the stock, argued that the beat was less than what UnitedHealth (UNH) achieved last week with its 2Q 2022 results.