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Molina Healthcare (MOH) to Post Q4 Earnings: What to Expect

Zacks Equity Research
·4-min read

Molina Healthcare, Inc MOH is scheduled to report fourth-quarter 2019 results on Feb 10.

The Zacks Consensus Estimate for earnings is pegged at $2.62, indicating a 32.5% plunge from the year-ago reported figure.

Q4 Earnings Expectations

The company’s earnings are likely to have been affected by softer revenues and its ramped-up profit-improvement opportunities. Other factors hurting the bottom line might have been lower enrollment due to loss of contracts. The company's total number of members in Texas and Washington are likely to have declined in the fourth quarter.

Revenues of the company are also expected to have decreased due to weak Medicaid membership and waning premiums. The consensus mark for total revenues stands at $4.3 billion, suggesting an 8.4% drop from the prior-year reported number. The Zacks Consensus Estimate for premiums implies a fall of 8.2% from the year-ago reported figure.

The consensus mark for premium revenues from its Marketplace business is pegged at $340 million, hinting at a 29% decline from the year-ago reported figure.

Nevertheless, the company is expected to witness a positive operating leverage in the upcoming quarterly results.

Molina Healthcare is likely to have benefited from attractive cash-flow generation in the to-be-reported quarter owing to balance sheet strength.

Company Guidance

Per the company’s last earnings call, management’s fourth-quarter earnings expectation was in the range of $2.50-$2.75.

What the Quantitative Model Predicts

Our proven model predicts an earnings beat for Molina Healthcare this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP: Molina Healthcare has an Earnings ESP of +0.48%. This is because the Most Accurate Estimate is pegged at $2.63, higher than the Zacks Consensus Estimate of $2.62.

Molina Healthcare, Inc Price and EPS Surprise

Molina Healthcare, Inc Price and EPS Surprise
Molina Healthcare, Inc Price and EPS Surprise

Molina Healthcare, Inc price-eps-surprise | Molina Healthcare, Inc Quote

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Zacks Rank: Molina Healthcare carries a Zacks Rank #3. Further, a positive ESP increases the odds of a positive surprise this earnings season.

Q3 Highlights and Surprise History

Molina Healthcare’s third-quarter 2019 adjusted earnings of $2.80 per share surpassed the Zacks Consensus Estimate by 3.3% and also improved 2.9% year over year, mainly owing to lower expenses.

Its surprise history is impressive, beating estimates in all the trailing four quarters, the average being 51.6%.

Other Stocks to Consider

Some other stocks worth considering from the medical sector with the perfect combination of elements to also surpass estimates in the next releases are as follows:

Change Healthcare Inc. CHNG has an Earnings ESP of +1.83% and a Zacks Rank of 1. The company is set to report fourth-quarter earnings on Feb 12. You can see the complete list of today’s Zacks #1 Rank stocks here.

Teladoc Health, Inc. TDOC has an Earnings ESP of +11.17% and a Zacks Rank  of #3. The company is set to report fourth-quarter earnings performance on Feb 26.

Tandem Diabetes Care, Inc. TNDM is slated to release fourth-quarter financial figures on Feb 24. The stock has an Earnings ESP of +27.59% and is Zacks #1 Ranked.

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