Centene bounces back after surprise quarterly loss sent it plunging in pre-market trading
Centene, the largest seller of Affordable Care Act plans, dropped 12% in premarket trading before recovering those losses and then some after posting an unexpected loss in its second-quarter earnings.
The company reported an adjusted loss per share of $0.16, compared to the earnings per share of $0.13 analysts polled by FactSet were expecting. The insurer attributed the miss to lower enrollment in Medicaid and Medicare, two government healthcare programs for the poor and elderly, as well as higher-than-expected costs from medical expenses.
“We are disappointed by our second quarter results, but we have a clear understanding of the trends that have impacted our performance, and are working with urgency and focus to restore our earnings trajectory,” Centene CEO Sarah M. London said in a statement.
Centene withdrew its 2025 guidance earlier this month on the back of new data that showed its ACA enrollees using their benefits significantly more than expected, which threatens to eat into profits. The company also faces headwinds from major cuts to Medicaid recently passed into law.
Centene’s stock rose about 7% after initially dipping on the news in premarket trading. Still, it’s down more than 50% since the start of the year, as of yesterday’s close.
