Centene (CNC) Stock Forecast & Price Target

Centene's managed care operations have demonstrated strong financial health, with a notable Medicaid HBR of 93.4% showing year-over-year improvement and a sequential increase of approximately 150 basis points. The company's Medicare membership and Part D pharmaceutical plan enrollment exceeded expectations, with Medicare members at 1.01 million and PDP members at 7.97 million, indicating robust demand in the healthcare market. Furthermore, Centene anticipates a composite rate improvement of around 5.5%, bolstered by favorable rate dynamics in its premium revenue cohorts, enhancing its overall outlook for sustained growth.

Centene's anticipated shift to a lower percentage of low-cost Silver positions, dropping from 55% in 2025 to 42% in 2026, indicates a deterioration in the affordability and competitiveness of its offerings in the marketplace. Additionally, the company's guidance for FY25 includes a significant pre-tax earnings impact of approximately $2.4 billion, primarily due to lower-than-expected risk adjustment, which could negatively affect profitability. The company remains at risk from declining marketplace risk scores, tightening Medicaid margins, and unforeseen pressures within the Medicare Part D business, all contributing to a bleak outlook for its stock performance.