Guidance for 2017
Based on the company’s performance in 1Q17, Anthem (ANTM) has increased its 2017 revenue guidance by around $1.5 billion. The company expects full-year 2017 revenues in the range of $88 billion to $89 billion. This change is based on expectations of higher enrollments in 2017 than were previously projected.
Anthem has also increased its 2017 guidance for fully insured membership by approximately 100,000. The company has projected solid growth trends for both its individual and local group insured businesses, and it expects fully insured membership to fall 15.2 million–15.3 million in 2017.
Anthem, however, expects its self-insured membership to fall 25 million–25.1 million at the end of 2017. While the large group self-funded business is expected to demonstrate solid growth trends, it should be partly offset by falling BlueCard enrollments.
The company expects its total membership in 2017 to include 300,000 to 500,000 more beneficiaries on a year-over-year (or YoY) basis.
If Anthem’s enrollments surpass these projections, it may have a favorable impact on the company’s stock price as well as those of the Health Care Select Sector SPDR Fund (XLV). Anthem makes up about 1.7% of XLV’s total portfolio holdings.
Analysts’ recommendations for Anthem
Of the 20 analysts covering Anthem in April 2017, eight have rated the company a “strong buy” and three have rated it a “buy.” Nine analysts have rated it a “hold” while none of the analysts rated the company a “sell” or a “strong sell.” Approximately 55% of the analysts have given the company some form of “buy” recommendation.
Of the 24 analysts covering UnitedHealth Group (UNH) in April 2017, ~96.0% rated it a “buy.” Approximately 74.0% of the 19 analysts covering Centene (CNC) gave it a “buy” recommendation in April 2017. About 54.0% of the 22 analysts covering Aetna (AET) have rated it a “buy” for the same month.
In the next part of this series, we’ll discuss Anthem’s government business in greater detail.