Investors need to pay close attention to ELV stock based on the movements in the options market lately.
Elevance Health Inc (NYSE:ELV) stock yesterday enjoyed its biggest single-day percentage gain since May 2024 after reporting $547 million in profits, but it wasn't enough to erase its worst day since March 2020 in the previous session, after the Centers for Medicare & Medicaid Services proposed to raise Medicare Advantage payment rates by only 0.09% in 2027.
ELV tops Q4 EPS estimates as premiums grow and Carelon revenues surge, even as medical membership slips and expenses climb.
Elevance Health, Inc. (ELV) Q4 2025 Earnings Call Transcript
Elevance Health, Inc. faces persistent margin and volume pressures, with Q4 operating revenue down 55% YoY and weak 2026 guidance. ELV's benefit expense ratio remains elevated at 90%, with medical inflation and higher utilization driving cost pressures and reduced profitability. Guidance for 2026 anticipates revenue and EPS declines, with adjusted EPS expected to drop 16% and investment income down 15%.
Although the revenue and EPS for Elevance Health (ELV) give a sense of how its business performed in the quarter ended December 2025, it might be worth considering how some key metrics compare with Wall Street estimates and the year-ago numbers.
Elevance Health (ELV) came out with quarterly earnings of $3.33 per share, beating the Zacks Consensus Estimate of $3.1 per share. This compares to earnings of $3.84 per share a year ago.
ELV heads into Q4 results with rising premiums and solid revenue growth, but higher expenses and margin pressure could weigh on earnings.
Elevance Health (ELV) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
Elevance Health is rated a Buy with a $400 price target, reflecting 18% upside and potential market outperformance. ELV trades at a significant discount to peers, with an 11x earnings multiple and strong double-digit top-line growth despite sector headwinds. Recent FQ3 2025 results showed a double-beat, with revenue up 12% year-over-year and EPS surpassing analyst estimates, signaling a turnaround.
Merck offers strong dividend growth, a robust drug pipeline, and strategic acquisitions, positioning it well beyond Keytruda's patent expiration. MRK's 3.9% dividend yield, low payout ratio, and A+ credit rating support its 14-year dividend growth streak and future income potential. Elevance Health faces near-term headwinds but boasts a large consumer base, efficiency initiatives, and a 13-year dividend growth record.
Elevance Health reaffirmed its long-term goal of targeting at least 12% average annual growth in adjusted diluted EPS. ELV trades at a forward P/E of 11.5, below UNH's at 22, suggesting undervaluation if growth continues from 2026. The key risk remains a health benefit ratio above 90%, which will be closely monitored in upcoming quarters.