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Centene Corporation (CNC), a leading multinational healthcare enterprise, is dedicated to providing high-quality, cost-effective healthcare solutions to individuals and families across the United States. Headquartered in St. Louis, Missouri, the company operates an extensive network of health plans and services, focusing on government-sponsored programs such as Medicaid, Medicare, and the Health Insurance Marketplace. With a market cap of $30.9 billion, Centene continues to drive innovation, accessibility, and value-based care while improving health outcomes for diverse communities nationwide.
Centene's shares have significantly underperformed the broader market over the past year. CNC stock has plummeted 18% over the past 52 weeks and gained marginally on a YTD basis, lagging behind the S&P 500 Index’s ($SPX) surge of 22.6% over the past year and 3.1% on a YTD basis.
Zooming in further, CNC has also lagged behind the SPDR S&P Health Care Services ETF’s (XHS) 18.4% gains over the past year and 13.6% on a YTD basis.
Centene shares have lagged behind the broader market and peers due to profitability concerns, sector-wide challenges, and rising medical costs. Following its Q4 earnings release on Feb. 4, shares dropped 5.5%. The company reported a 3.4% year-over-year revenue increase to $40.81 billion, surpassing market expectations by 4.4%. Adjusted EPS soared 62.2% to $0.80, while adjusted EBITDA of $520 million significantly outpaced forecasts. The operating margin remained steady at 0.4%, which aligns with the prior year. Centene’s customer base slightly declined to 28.6 million from 28.64 million in the previous quarter. For fiscal 2025, the company issued a minimum adjusted EPS guidance of $7.25, with expectations averaging $7.32.
For the current fiscal year, ending in December 2025, analysts expect CNC’s EPS to grow 1.1% year over year to $7.25. The company’s earnings surprise history is mixed. It surpassed Wall Street’s bottom-line estimates in three of the past four quarters while missing on one other occasion.
Among the 17 analysts covering the stock, the consensus rating is a “Moderate Buy,” which is based on 10 “Strong Buys,” six “Holds,” and one “Moderate Sell” rating.
This configuration is more bullish than three months ago, with eight “Strong Buy” ratings on the stock.
On Feb. 5, Andrew Mok, CFA from Barclays (BCS), maintained a “Buy” rating on Centene with a price target of $93 – the Street High, implying a potential upside of 53.1%. The mean price target of $78.09 represents a premium of 28.6% to current price levels.
