Fannie Mae, Freddie Mac shares tumble after conservatorship comments
Investing.com - TD Cowen downgraded Centene (NYSE:CNC) from Buy to Hold on Monday, while significantly reducing its price target to $33.00 from the previous $73.00. The stock, currently trading near its 52-week low at $27.95, has declined over 56% in the past six months, with InvestingPro data showing the stock in oversold territory.
The research firm cited a lack of clarity across multiple Centene service lines, including Medicaid (MDCD), Health Insurance Exchange (HIX), and Prescription Drug Plan (PDP) operations as the primary reason for the downgrade.
TD Cowen’s revised price target of $33.00 represents 7.3 times the firm’s adjusted 2026 earnings per share estimate of $4.50 for the healthcare company.
The analyst’s model assumes recovery of approximately half of the Health Insurance Exchange Risk Adjustment headwind in 2026, with modest margin recovery in Medicaid and Medicare Advantage offset by lower core HIX margin and investment income.
TD Cowen noted that while Centene is now trading at all-time lows, the ongoing uncertainty across its key business segments necessitated the move to a Hold rating.
In other recent news, Centene Corporation has faced several downgrades from major financial institutions. BofA Securities downgraded Centene from Neutral to Underperform, reducing the price target from $52.00 to $30.00, due to concerns about the Medicaid and Affordable Care Act exchanges, which contribute significantly to the company’s revenue. Similarly, Morgan Stanley (NYSE:MS) downgraded Centene from Overweight to Equalweight, citing pressure in the Health Insurance Exchange business and adjusting its earnings per share estimate for 2025 to $3.78 from $7.35. Wolfe Research also noted that Centene has withdrawn its 2025 financial guidance due to challenges in the Marketplace business and Medicaid, leading to a substantial reduction in expected earnings per share. In contrast, Canada Nickel Company reported positive drilling results at its MacDiarmid property, identifying significant nickel mineralization over a substantial strike length. The company plans to continue its exploration efforts and anticipates releasing additional resource estimates by year-end. Meanwhile, TD Cowen reiterated a Buy rating on CVS Health (NYSE:CVS), highlighting its limited exposure to individual market risks compared to Centene. These developments reflect the diverse challenges and opportunities currently facing these companies.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.