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Investing.com - Guggenheim raised its price target on Elevance (NYSE:ELV), an $80.5 billion healthcare provider trading at a notably low revenue multiple according to InvestingPro, to $398.00 from $360.00 on Wednesday, while maintaining a Buy rating on the health insurance company’s stock.
The price target increase reflects higher peer multiples and improved market sentiment, according to Guggenheim. The firm noted that Elevance shares have risen approximately 17% since reporting second-quarter earnings, outperforming the S&P 500’s gain of about 7% during the same period.
Guggenheim views Elevance’s near-term financial outlook as "largely de-risked" following management’s recent commentary and reiteration of 2025 guidance. The firm projects a reasonable $20-$21 earnings per share floor for 2025 and suggests $27-$28 as a starting point for 2026 EPS generation before accounting for any SG&A or operational leverage benefits.
The research firm did not update its earnings estimates, preferring to await greater clarity around Elevance’s positioning to drive outsized earnings growth from the projected baseline.
Guggenheim recommends buying Elevance shares on any short-term price dislocations, citing repricing efforts, capital deployment, Carelon maturation, and other factors that support a longer-term 12%+ growth trajectory once the company moves past current end-market disruptions. The company maintains a "GREAT" financial health score on InvestingPro, with a 14-year track record of consecutive dividend increases and a current yield of 1.91%.
In other recent news, Elevance Health has reaffirmed its full-year 2025 earnings guidance, projecting shareholders’ earnings to be approximately $24.10 per diluted share, including about $5.90 per diluted share of net unfavorable items. Excluding these items, the adjusted earnings outlook remains at roughly $30.00 per diluted share. The company also expects to maintain a full-year 2025 benefit expense ratio of about 90.0%. Additionally, Cantor Fitzgerald has reiterated its Overweight rating on Elevance Health with a $400.00 price target, noting enrollment volatility in specific states. The firm remains cautious about the 2026 marketplace environment despite successful rate negotiations in many states. Meanwhile, Bernstein has raised its price target for UnitedHealth Group to $379.00 from $337.00, maintaining an Outperform rating. The U.S. government is behind schedule in hiring medical coders to audit Medicare Advantage plans, potentially impacting the backlog of audits. These developments reflect ongoing strategic and operational adjustments within the healthcare sector.
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