Elevance Health has delivered second-quarter earnings and full-year profit guidance that beat expectations, sending its shares more than 6% higher in early Wednesday morning trade.
The health insurance provider reported a 13% rise in operating revenue to $43.4 billion for the quarter ended June 30, 2023, as it raised premiums in its Health Benefits business and due to membership growth in Medicaid and Medicare. It also attributed the improvement to growth in pharmacy product revenue within CarelonRx driven by growth in external pharmacy members served and the acquisition of BioPlus in the first quarter of 2023.
The company’s benefit expense ratio, which measures the percentage of claims paid to premiums collected, fell 70 basis points year-over-year to 86.4%.
Adjusted net income amounted to $9.04 per share, above Refinitiv IBES estimates of $8.80.
Given the strong performance in the first half of the year and momentum across Elevance Health, the company said it now expects full-year 2023 adjusted net income to be greater than $32.85 per share, beating the $32.80 pencilled in by analysts, according to Refinitiv data.
“Our solid execution and continued progress of our strategy to become a lifetime trusted health partner resulted in strong second quarter and first half results,”CEO Gail Boudreaux commented.
“Our focused efforts to optimize our mature businesses, invest in high-growth opportunities, and accelerate our growth through Carelon to meet the whole health needs of consumers positions us well for the rest of 2023 and beyond.”
The company’s shares were up 4.7% at $466.23 by 11am in New York.
Contact the author at stephen.gunnion@proactiveinvestors.com