Crispr Therapeutics shares tumble after significant earnings miss
Investing.com - UBS lowered its price target on Molina Healthcare (NYSE:MOH) to $260.00 from $325.00 on Tuesday, while maintaining a Neutral rating on the healthcare insurer. The stock, currently trading at $233.51, is near its 52-week low of $230.96, with InvestingPro data showing it trades at an attractive P/E ratio of 11.2x.
The price target reduction follows Molina’s preliminary second-quarter 2025 results, which revealed earnings per share of $5.50, falling short of the consensus estimate of $6.20. Despite recent challenges, InvestingPro analysis indicates the company maintains a "GREAT" overall financial health score, with particularly strong profitability metrics.
Molina Healthcare also reduced its full-year 2025 EPS guidance to a range of $21.50-22.50, significantly below both the consensus estimate of $24.48 and the company’s previous guidance of "At least $24.50."
The company attributed the earnings shortfall to medical cost pressures across all three of its business lines during the quarter, with expectations that these pressures will persist through the second half of 2025.
Molina specifically noted that the medical cost trend has recently accelerated, though the company characterized the current gap between premium rates and medical cost trends as temporary.
In other recent news, Molina Healthcare has announced lower-than-expected second-quarter earnings and reduced its full-year 2025 guidance due to rising medical costs across its business segments. The company projects second-quarter adjusted earnings of approximately $5.50 per share, below previous expectations, and has revised its full-year earnings guidance to between $21.50 and $22.50 per share. Barclays (LON:BARC) has responded by lowering its price target for Molina Healthcare to $270, citing cost pressures and a disappointing pre-announcement. Meanwhile, Cantor Fitzgerald has maintained its Overweight rating with a $356 price target, noting limited impact from Medicaid work requirements on the company.
Morgan Stanley (NYSE:MS) has initiated coverage on Molina Healthcare with an Overweight rating and a price target of $364, highlighting the company’s focus on government-sponsored managed care products and potential premium revenue growth. Despite policy uncertainties, Morgan Stanley expects Molina Healthcare to maintain industry-leading margins and sees opportunities in Dual Eligible Special Needs Plans. Additionally, Barclays has revised its 2025 EPS estimate for Molina to $21.75, reflecting elevated cost trend uncertainties. These developments indicate that Molina Healthcare is navigating a challenging environment with mixed analyst perspectives on its future prospects.
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