Medicare business

On its first-quarter earnings conference call, Centene (CNC) guided for almost flat MA (Medicare Advantage) memberships in 2019 on a YoY (year-over-year) basis. However, it expects 2020 to prove to be an inflection point for its MA business. It also expects to return to a four-star MA rating in 2020.

Centene’s joint venture with nonprofit health system Ascension and its acquisition of WellCare Health Plan are also expected to bolster its MA business in 2020.

What’s Centene Expecting of Its Medicare and Medicaid Businesses?

According to its first-quarter earnings conference call, at the end of the first quarter, Centene had 394,000 members enrolled in either its MA plan or its Medicare-Medicaid plan across 20 US states, a YoY rise of ~50,000 members but a sequential fall of 23,000 members. The company is currently working on repositioning its acquired Fidelis Care MA business to secure a four-star rating.

Centene expects to strengthen its MA and Medicare Part D capabilities, mainly in its existing markets, through the acquisition of the WellCare Health Plan. After the acquisition, the company expects to serve 5 million Medicare members and earn almost 15% of its $100 billion 2019 pro forma revenue from this business.

Medicaid business

In the first quarter, Centene reported 8.58 million Medicaid members, a YoY rise of 21%, or 1.5 million members.

According to its first-quarter earnings conference call, the company has managed to re-procure its Medicaid contract in New Hampshire, which will cover 180,000 members and will become effective on September 1, 2019. The company had 83,000 members enrolled in the previous managed Medicaid program in New Hampshire at the end of the first quarter.

According to its first-quarter earnings conference call, Centene managed to win managed Medicaid contracts in two major regions in North Carolina, and it has plans to actively appeal to expand its presence in the remaining areas of the state. The company will be one of the two key players in the managed Medicaid program in Iowa effective July 1, 2019.

Latest articles

This year, Pfizer (PFE) stock has fallen 0.34% and Bristol-Myers Squibb (BMY) stock has fallen 6.48%. Both companies are focused on strengthening their position in the high-growth oncology and immunology markets. Let's take a closer look at each.

Walt Disney’s (DIS) latest movie, Toy Story 4, has reportedly broken records in the opening weekend with $118 million in sales. However, the opening weekend collection was behind analysts’ expectations of at least $150 million in the first weekend.

24 Jun

Will Home Depot’s Upward Momentum to Continue?

WRITTEN BY Rajiv Nanjapla

As of June 21, Home Depot (HD) was trading at $209.39, which implies a rise of 9.7% since the announcement of its first-quarter earnings on May 21. Also, the company was trading at a premium of 32.4% from its 52-week low of $158.09 and a discount of 2.8% from its 52-week high of $215.43.

On June 21, Aurora Cannabis (ACB) made an announcement that indicated that it will move towards higher margin vape products. In addition, the company also believes concentrates and edibles will command higher margins. In anticipation of this development, the company announced the expansion of its facility to capitalize on growth related to these segments.

Shares of Mondelēz International (MDLZ) are scaling new heights thanks to its stellar gains so far this year. Mondelēz stock is up 38.0% on a YTD (year-to-date) basis, and it closed at $55.25—just a shade lower than its 52-week high of $55.71—on June 21.

24 Jun

How Long Will Facebook's Libra Fuel Bitcoin Rally?

WRITTEN BY Mayur Sontakke, CFA, FRM

Ever since the news about Facebook’s (FB) cryptocurrency project broke, Bitcoin has rallied on the hope that Facebook’s entry in the space will help make cryptocurrencies mainstream. Facebook’s cryptocurrency will be called Libra and will be governed by an association with 28 founding members across industries.