Street Calls of the Week
Investing.com - Cantor Fitzgerald maintained its Neutral rating and $38.00 price target on Centene (NYSE:CNC) in a research note published Friday. According to InvestingPro data, the healthcare giant, currently trading at $37.83, shows a P/E ratio of 9.3x and generates annual revenue of $159.67B.
The investment firm highlighted Centene’s path to achieving break-even Medicare Advantage (MA) margins by 2027, noting this goal will be supported by a significant increase in bonus revenue.
Cantor Fitzgerald projects that Centene will see bonus revenue increase to $127 million in 2027, compared to $0 million in 2026, representing a $127 million year-over-year improvement.
This revenue boost is expected to come from Centene increasing the percentage of members in plans rated 4 Stars or higher to 20%.
The firm indicated this trajectory provides Centene with "an incremental cushion" in meeting its targets for break-even Medicare Advantage margins in 2027.
In other recent news, Centene has been the focus of several analyst updates and company announcements. The company reaffirmed its full-year adjusted earnings per share guidance of $1.75, which was reiterated by Bernstein, who maintained an Outperform rating with a $36.00 price target. Truist Securities also showed confidence in Centene by raising its price target to $39.00 from $35.00, keeping a Buy rating, following the company’s recent 8-K filing and conference presentation. Barclays maintained its Equalweight rating with a $33.00 price target, noting positive Medicaid results for July and August, which support Medicaid MLR improvement for the second half of 2025.
Cantor Fitzgerald has reiterated its Neutral rating with a $38.00 price target, highlighting state-specific Medicaid shifts and marketplace rate concerns as factors impacting Centene’s performance. The finalized 2026 marketplace rates, which align with payor proposals but fall short of the anticipated 30%+ increases, have contributed to a cautious outlook. Despite these challenges, Centene’s management remains optimistic about its Marketplace business and ACA trends, which are reportedly in line with expectations. These recent developments provide investors with a clearer picture of Centene’s strategic positioning and financial outlook.
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