Health Care
Price
$407.50
-1.76%Market Cap
$88.37B
Day High
$414.46
Day Low
$406.33
Elevance Health's Q2 FY2026 revenue grew modestly to $50.5B while profitability declined sharply, with operating income down 27.3% and EPS down 13.1%, driven by elevated Medicaid/Medicare medical cost trends, a Medicare Advantage risk-adjustment loss contingency accrual, and increased operating expenses tied to workforce and transformation initiatives.
Key risk: Elevated Medicaid and Medicare Medical Cost Trends
The benefit expense ratio rose 80bp YoY to 89.7% in Q2 FY2026 due to elevated medical cost trends in Medicaid and Medicare, driven by membership shifts, lower effectuation rates, and increased population acuity following ACA redeterminations and APTC expiration. Continued cost trend volatility could further pressure margins if pricing does not adequately reflect underlying costs.
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