Molina Healthcare, Inc MOH is
scheduled to report fourth-quarter 2018 results on Feb 11. In the
last reported quarter, the company delivered a positive surprise of
75.8%.
Q4 Earnings Expectations
Molina Healthcare expected fourth-quarter earnings to be around
$1.90 per share. This upside is most likely to be backed by higher
membership and restructuring initiatives taken by the company. The
companyâs Medicaid business is also expected to carry on performing
well in the fourth quarter.
However, the same would likely be offset by the Marketplace
business, rising medical costs, tax rate and an increase in general
and administrative expense ratio.
The Zacks Consensus Estimate for the companyâs fourth-quarter
earnings is pegged at $1.52, up 347% year over year.
However, its revenues might suffer due to poor performance by the
Marketplace business. The Zacks Consensus Estimate for the
companyâs revenues is pegged at a decline of 7.8% year over year to
$4.5 billion.
The companyâs operational efficiency might have improved in the
to-be-reported quarter.
However, administrative expense of the company is likely to
increase in the fourth quarter due to higher marketing programs and
certain transformation measures adopted by the company. The company
earlier expected that the sale of Pathways would incur a loss of
around 60 cents per share in the fourth quarter.
The company projected the general and administrative expense ratio
to be 8%, primarily due to seasonal spending, IT project costs,
costs related to transformation efforts, which would likely bear an
impact on 2019 earnings.
Long-term debt of the company is likely to mount due to its
growth-related investments.
Earlier, Molina Healthcare issued a projection for the medical care
ratio regarding the second half in the upper 70sâ bracket because
of shift in membership, utilization, etc.
Why a Likely Positive Surprise?
Our proven model conclusively shows that Molina Healthcare is
likely to beat on earnings this to-be-reported quarter. This is
because the stock needs to have the right combination of a positive
Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or
3 (Hold) for this to happen.
Earnings ESP: Molina Healthcare has an Earnings ESP of +2.89% as the Most Accurate Estimate of $1.57 is pegged higher than the Zacks Consensus Estimate of $1.52. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Molina Healthcare, Inc Price and EPS Surprise
Molina Healthcare, Inc Price and EPS Surprise | Molina Healthcare, Inc Quote
Zacks Rank: Molina Healthcare
sports a Zacks Rank of 1, which increases the predictive power of
ESP. Further, with a positive ESP in the combination, the stockâs
chances of beating estimates are significantly higher.
Conversely, the Sell-rated stocks (#4 or 5) should never be
considered going into an earnings announcement, especially when the
company is seeing negative estimate revisions.
Upcoming Releases From Medical Sector
Some other stocks worth considering from the medical sector are as
follows:
Adamas Pharmaceuticals, Inc. ADMS is set to report fourth-quarter
2018 earnings performance on Feb 28. The stock has an Earnings ESP
of +5.15% and a Zacks Rank #3. You can see the complete
list of todayâs Zacks #1 Rank (Strong Buy) stocks
here.
Tenet Healthcare Corporation THC is slated to announce
fourth-quarter earnings on Feb 25. It has a Zacks Rank of 3 and an
Earnings ESP of +4.17%.
Alder BioPharmaceuticals, Inc. ALDR has an Earnings ESP of +13.86%
and a Zacks Rank #2. The company is scheduled to release
fourth-quarter earnings on Feb 25.
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Alder BioPharmaceuticals,
Inc. (ALDR) : Free Stock Analysis Report
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Tenet Healthcare
Corporation (THC) : Free Stock Analysis Report
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