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Centene’s Revenue and Income Rose in 3Q15

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Centene’s price movement

Centene (CNC) has a market cap of $7.3 billion. Centene’s YTD (year-to-date) price movement is going down quarter over quarter in 2015. After the 3Q15 earnings report, CNC rose 4.8% to close at $60.84 per share as of October 27, 2015. Revenue and income increased 5.7% and 6.8%, respectively, in 3Q15. Price movements on weekly, monthly, and YTD bases are 1.6%, 15.5%, and 17.2%, respectively.

Technically, Centene has sometimes broken the support of 20-day, 50-day, and 200-day moving averages in 2015. Currently, its 20-day, 50-day, and 200-day moving averages are 7.8%, 1.0%, and -7.70%, respectively.

The SPDR S&P Health Care Services ETF (XHS) invests 2.4% of its holdings in Centene. The ETF tracks an equal-weighted index of healthcare services companies as defined by GICS (Global Industry Classification Standard). The YTD price movement of XHS is -50.0% as of October 26, 2015.

Following are the market caps for some of Centene’s (CNC) competitors:

  • Humana (HUM) — $26.0 billion
  • Health Net (HNT) — $5.0 billion
  • WellCare Health Plans (WCG) — $3.8 billion
  • Molina Healthcare (MOH) — $3.7 billion
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Centene’s 3Q15 performance

Centene has reported net revenue of $5,821 million in 3Q15, an increase of 5.7% compared to $5,506 million in 2Q15. Operating revenue increased 5.8% in 3Q15. Net income and EPS (earnings per share) increased to $94 million and $0.76, respectively, in 3Q15, an increase of 6.8% and 5.6%, respectively, on a quarterly basis. Net profit margin increased to 1.6% in 3Q15, an increase of 1.3% on a quarterly basis.

Cash and cash equivalents decreased 15.4%, and premium and related receivables increased 2.6% in 3Q15. The current ratio and debt-to-equity ratio have decreased to 1.00 and 2.49 in 3Q15 compared to the current ratio and debt-to-equity ratio of 1.10 and 2.53 in 2Q15.

Below are some of Centene’s key 3Q15 activities:

  • Centene and Health Net signed an agreement in which Centene will acquire all of Health Net shares in a cash and stock transaction valued at ~ $6.8 billion, including the assumption of ~ $500 million of debt.
  • Centene’s Washington subsidiary, Coordinated Care of Washington, has been selected by the Washington State Health Care Authority as the apparent successful bidder for the Apple Health Foster Care contract.
  • Centene’s Georgia subsidiary, Peach State Health Plan, successfully reprocured the contract to serve Medicaid recipients in Georgia.

About Centene

Centene is a diversified healthcare company. It provides specialty services, including behavioral health management, care management software, correctional healthcare services, dental benefits management, in-home health services, life and health management, managed vision, pharmacy benefits management, specialty pharmacy, and telehealth services.

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