Centene Corp (NYSE:CNC) shares fell almost 40% after the healthcare company withdrew its full-year 2025 financial guidance due to weak growth and higher-than-expected costs in its Affordable Care Act (ACA) marketplace business.
Based on a preliminary analysis from the independent actuarial firm Wakely, Centene anticipates a $1.8 billion shortfall in risk adjustment revenue for 2025, which translates to a $2.75 per share reduction in adjusted earnings.
The analysis showed unexpectedly poor conditions in Centene’s Health Insurance Marketplace business, which covers 22 of its 29 marketplace states and represents about 72% of its marketplace membership.
The data showed that the marketplace population was sicker than expected (higher morbidity), while overall market growth was weaker than anticipated.
Shares of Centene traded down 39.7% at about $34 in the early afternoon on Wednesday.