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Key Takeaways
- Elevance Health exceeded earnings and revenue estimates for the first quarter and raised its outlook as it reported lower costs.
- The health insurer said it lowered its benefit expense ratio by 20 basis points and increased its total operating margin to 7.1%.
- Elevance shares were up nearly 4% in late trading Thursday, at their highest level since late 2022.
Shares of Elevance Health (ELV) rose to their highest level since late 2022 on Thursday as the health insurance provider posted better-than-expected results and raised its guidance amid lower costs.
Elevance reported first-quarter earnings per share (EPS) of $10.64, with revenue increasing 0.9% to $42.3 billion. Both were higher than analysts’ estimates.
The company’s benefit-expense ratio, which measures the cost of claims to premiums, was 85.6%, an improvement of 20 basis points (bps) that also beat forecasts. Elevance said that the gain was “driven primarily by premium rate adjustments to cover medical cost trend in our Health Benefits business.”
Revenue from premiums slipped 0.5% to $35.7 billion, while benefit expenses were down 0.8% to $30.55 billion. Total operating margin rose to 7.1% from 6.8% last year.
CEO Gail Boudreaux said the results “reflect disciplined execution of our strategic initiatives during a dynamic time for our industry.”
The company now anticipates full-year EPS of greater than $37.20, up from its previous outlook of greater than $37.10.
Elevance Health shares traded at their highest level since December 2022 on Thursday afternoon, up 3.8% at $528.26 at about 3:45 p.m. ET
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