NYSE$CNC

Centene Corp · Q1 2021 earnings

Q1 2021 earnings · · Investor relations

Briefing

Centene reported solid revenue and earnings growth in Q1 2021 and increased its full-year guidance.

Centene Corporation announced its financial results for the first quarter ended March 31, 2021, reporting diluted earnings per share (EPS) of $1.19 and adjusted diluted EPS of $1.63. The company is increasing its full-year guidance, driven by the positive first quarter momentum.

  • Managed care membership of 25.1 million, an increase of 1.3 million members, or 5%, compared to March 31, 2020.
  • Total revenues of $30.0 billion, representing 15% growth compared to the first quarter of 2020.
  • Diluted EPS of $1.19, compared to diluted EPS of $0.08 for the first quarter of 2020.
  • Adjusted diluted EPS of $1.63, compared to $0.86 for the first quarter of 2020.

Headline financials

Total Revenue

$30B

Previous: $26B+15.2%
EPS (adj)

$1.63

Previous: $0.86+89.5%
SG&A expense ratio

8.4%

Previous: 9.9%-15.2%
Adjusted SG&A ratio

8.1%

Previous: 8.6%-5.8%
Capital Expenditures

-$187M

Previous: -$177M-5.6%
Free Cash Flow

$512M

Previous: -$131M+490.8%
Net Income

$699M

Previous: $46M+1419.6%
Operating Income

$1.05B

Previous: $188M+460.6%
Gross Profit

$28.9B

Previous: $25.2B+14.8%
Cash & Equivalents

$9.63B

Previous: $9.31B+3.4%
Total Assets

$70.3B

Previous: $66.4B+5.8%
Stock-Based Comp

$51M

Previous: $117M-56.4%

Revenue & EPS history

Centene · Revenue · Quarterly

$30B

Q1 2021+15.2%vs Q1 2020
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

Centene · $29.4B total across 4 segments · Q1 2021

  • Medicaid
    $20.2B+18.5%
  • Commercial
    $3.9B-5.4%
  • Medicare
    $3.76B+24.6%
  • Other
    $1.56B+24.5%

Forward guidance

The Company's annual guidance for 2021 is as follows: Total revenues (in billions) $120.1 - $122.1, GAAP diluted EPS $3.68 - $3.90, Adjusted diluted EPS $5.05 - $5.35, HBR 87.1% - 87.7%, SG&A expense ratio 8.4% - 8.9%, Adjusted SG&A expense ratio 8.3% - 8.8%, Effective tax rate 24.7% - 26.7%, Diluted shares outstanding (in millions) 589.0 - 592.0.

Tailwinds

  • ongoing suspension of Medicaid eligibility redeterminations to August 1
  • extensions of the California pharmacy services to July 1 and New York pharmacy services through 2022
  • Marketplace special enrollment period
  • recent Oklahoma contract awards
  • Medicare membership, sequestration, and the fee schedule increase

Headwinds

  • updated expectations regarding state premium rate adjustments
  • updated expectations regarding state risk sharing mechanisms
  • impact of COVID-19 on global markets
  • impact of COVID-19 on economic conditions
  • impact of COVID-19 on the healthcare industry

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2021

Historical avgQ1 2021

+0.4%

Avg return

Earnings day

+0.4%

Avg return

5 days after

+1.9%

Avg return

30 days after

54%

37 / 68 earnings

Positive

+13.8%

Q1 2014

Best reaction

-10.4%

Q2 2016

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.5%+22.6%+33.9%
Q4 2025-3.7%+1.3%+9.3%
Q3 2025+12.5%+3.9%+18.5%
Q1 2025-6.3%-2.8%-8.4%
Q4 2024-5.4%-9.1%-8.3%
Q3 2024+0.0%+0.3%-2.0%
Q2 2024+9.0%+14.1%+16.5%
Q1 2024-2.4%-4.5%-1.4%
Q4 2023+1.1%+4.4%+7.5%
Q3 2023-3.0%-4.8%+4.7%
Q2 2023-2.7%-3.7%-9.2%
Q1 2023-1.5%+1.9%-6.3%
Q4 2022+2.7%+2.4%-7.7%
Q3 2022+11.9%+13.2%+10.3%
Q2 2022+0.6%+1.1%+4.1%
Q1 2022-4.9%-5.1%-3.5%
Q4 2021+6.4%+3.1%+4.5%
Q3 2021+3.8%+4.8%+11.2%
Q2 2021-4.0%-5.6%-12.5%
Q1 2021-9.9%-6.5%+11.7%
Q4 2020+4.8%+1.6%+6.3%
Q3 2020-7.9%-11.0%-6.3%
Q2 2020-1.4%-3.0%-10.1%
Q1 2020-6.6%-8.3%-5.5%
Q4 2019+5.1%+0.4%-5.0%
Q3 2019+5.7%+5.4%+30.4%
Q2 2019+3.0%+2.4%-12.7%
Q1 2019+4.4%+9.5%+15.3%
Q4 2018-2.9%-3.2%-13.2%
Q3 2018-8.3%-9.9%-5.5%
Q2 2018-3.1%-3.0%+6.0%
Q1 2018-1.2%-0.4%+5.5%
Q4 2017+5.0%+2.3%+0.9%
Q3 2017-7.4%-3.7%-1.1%
Q2 2017-1.0%-1.8%+2.1%
Q1 2017+1.1%+3.3%+4.5%
Q4 2016+7.9%+9.1%+9.3%
Q3 2016+1.4%+0.1%-10.5%
Q2 2016-10.4%-6.3%-10.0%
Q1 2016+4.2%
Q4 2015+2.2%
Q3 2015+5.3%
Q2 2015+0.2%
Q1 2015-9.7%
Q4 2014+5.6%
Q3 2014+9.3%
Q2 2014+5.8%
Q1 2014+13.8%
Q4 2013+4.5%
Q3 2013-4.1%
Q2 2013+5.1%
Q1 2013+4.4%
Q4 2012+6.1%
Q3 2012+0.3%
Q2 2012+6.9%
Q1 2012-6.0%
Q4 2011-2.5%
Q3 2011+12.6%
Q2 2011+3.3%
Q1 2010+10.9%
Q1 2011+2.4%
Q4 2008-6.5%
Q4 2010-6.5%
Q3 2009-6.6%
Q2 2009-6.6%
Q3 2010-6.6%
Q4 2009-5.3%
Q2 2010-5.3%

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