NYSE$MOH

Molina Healthcare Inc · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Reported GAAP EPS of $3.10 and adjusted EPS of $3.36.

Molina Healthcare reported a solid third quarter performance with increased premium revenue and improved medical care ratio. The company's net income increased to $185 million, and adjusted EPS reached $3.36.

  • Premium revenue increased by 16.8% to $4.8 billion.
  • Medical care ratio improved to 85.9% compared to 86.3% in the third quarter of 2019.
  • General and administrative expense ratio decreased to 7.3% from 7.6%.
  • Net income rose to $185 million, compared to $175 million in the same quarter of the previous year.

Headline financials

Total Revenue

$5.02B

Previous: $4.24B+18.3%
EPS (adj)

$3.36

Previous: $2.83+18.7%
Total Membership

4.0M

No prior period
Medicaid Membership

3.6M

No prior period
Medicare Membership

113.0K

No prior period
Marketplace Membership

325.0K

No prior period
Capital Expenditures

-$64M

Previous: -$30M-113.3%
Free Cash Flow

$121M

Previous: $145M-16.6%
Net Income

$185M

Previous: $175M+5.7%
Operating Income

$289M

Previous: $257M+12.5%
Gross Profit

$923M

Previous: $4.24B-78.2%
Cash & Equivalents

$3.2B

Previous: $2.68B+19.3%
Total Assets

$7.88B

Previous: $6.7B+17.6%
Stock-Based Comp

$15M

Previous: $10M+50.0%

Revenue & EPS history

Molina · Revenue · Quarterly

$5.02B

Q3 2020+18.3%vs Q3 2019
Beat estimate in 15 of 16 quarters(94%)
ActualEstimate

Revenue by segment

Molina · $8.04B total across 3 segments · Q2 2023

  • Medicaid
    $6.49B+2.9%
  • Medicare
    $1.04B+9.1%
  • Marketplace
    $513M-5.2%

Forward guidance

The Company has increased its full year 2020 total revenue guidance to approximately $19.6 billion. While the Company’s core performance is expected to remain strong through the fourth quarter of 2020, the Company is choosing to maintain its existing earnings guidance.

Tailwinds

  • Full year 2020 total revenue guidance increased to approximately $19.6 billion.
  • Revenue reflects the Passport membership.
  • Revenue reflects higher Medicaid enrollment through the third quarter of 2020.
  • Core performance is expected to remain strong through the fourth quarter of 2020.
  • Magellan Complete Care acquisition is on track to close around the end of the year.

Headwinds

  • Continued uncertainty related to COVID’s impact on medical care costs.
  • Possibility for additional COVID-related rate refunds.
  • Cautious approach due to uncertainty related to COVID.
  • Marketplace MCR was negatively affected by COVID-related impacts.
  • Marketplace MCR was negatively affected by some modest underachievement of risk scores relative to the acuity of certain Marketplace members.

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 Q3 2020

Historical avgQ3 2020

+0.2%

Avg return

Earnings day

+1.6%

Avg return

5 days after

+2.9%

Avg return

30 days after

41%

27 / 66 earnings

Positive

+26.3%

Q1 2017

Best reaction

-25.5%

Q4 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+2.6%+21.2%+20.3%
Q4 2025-25.5%-30.6%-18.3%
Q3 2025-17.3%-16.5%-27.5%
Q2 2025+4.9%+8.8%+13.3%
Q1 2025-5.5%-3.7%-8.1%
Q4 2024-10.1%-13.9%+3.3%
Q3 2024+14.0%+11.0%+2.4%
Q2 2024+13.0%+16.1%+20.5%
Q1 2024-3.0%-5.3%-8.6%
Q4 2023+6.8%+9.9%+9.9%
Q3 2023-0.7%-1.7%+10.1%
Q2 2023-2.6%-3.5%+1.0%
Q1 2023+6.3%+9.4%-2.2%
Q4 2022-0.5%-1.1%-13.7%
Q3 2022-3.9%-2.0%-10.7%
Q2 2022+2.7%+5.3%+9.7%
Q1 2022-1.9%-4.7%-5.1%
Q4 2021-0.5%-0.0%+1.8%
Q3 2021-0.8%-0.5%-2.4%
Q2 2021-2.0%+5.4%+3.2%
Q1 2021+1.2%+2.2%+0.2%
Q4 2020+5.0%+5.0%+12.9%
Q3 2020-8.2%-2.5%+1.5%
Q2 2020-1.6%-0.5%-2.0%
Q1 2020+5.2%+9.9%+12.8%
Q4 2019+10.5%+13.3%+3.1%
Q3 2019-0.3%-4.4%+11.0%
Q2 2019-4.4%-7.0%-6.5%
Q1 2019+0.9%-0.2%+2.0%
Q4 2018-5.5%-1.1%+3.6%
Q3 2018-0.8%-0.9%+11.1%
Q2 2018+18.7%+23.1%+34.7%
Q1 2018-2.9%-1.2%+3.4%
Q4 2017-3.8%-8.1%-2.8%
Q3 2017+16.1%+13.7%+14.6%
Q2 2017-6.8%-12.4%-4.0%
Q1 2017+26.3%+30.8%+31.3%
Q4 2016-17.2%+1.6%-6.0%
Q3 2016-5.9%-7.0%-9.3%
Q2 2016+10.1%+8.1%+4.2%
Q1 2016-20.6%
Q4 2015-1.5%
Q3 2015-8.6%
Q2 2015+9.6%
Q1 2015+11.6%
Q4 2014+8.8%
Q3 2014+4.6%
Q2 2014-6.5%
Q1 2014+4.5%
Q4 2013-6.4%
Q3 2013-7.5%
Q2 2013-1.4%
Q1 2013+1.6%
Q4 2012+10.0%
Q3 2012+14.3%
Q2 2012-1.7%
Q1 2011-2.5%
Q1 2012+0.2%
Q4 2011-0.2%
Q1 2010-0.2%
Q4 2009-0.2%
Q3 2010+1.2%
Q3 2011+1.2%
Q2 2011-2.7%
Q4 2010-2.7%
Q2 2010-2.7%

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