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Molina Healthcare (MOH) Q2 Earnings Beat Estimates, Rise Y/Y

Zacks Equity Research

Molina Healthcare, Inc.’s MOH second-quarter 2019 adjusted earnings of $3.11 per share surpassed the Zacks Consensus Estimate by 21.5%. Moreover, the bottom line improved 38% year over year, mainly on the back of lower expenses and the Meridian buyout.

Also, for the quarter under review, total revenues of $4.1 billion came ahead of the Zacks Consensus Estimate by 2.9%. However, the top line declined 14% year over year, mainly due to lower Medicaid membership and resizing of the Florida Medicaid contract as well as the exiting all but two Florida regions in 2018.

Quarterly Operational Update

The company’s net income totaled $196 million, down 3% year over year.

Total operating expenses decreased about 13.5% year over year to $3.9 billion. This improvement was attributable to lower medical care costs and no health insurer fees plus cost of service revenues.

For the second quarter, medical care cost was down 10% year over year to nearly $3.9 billion.

Molina Healthcare’s interest expenses dropped 31.3% year over year to $22 million due to constant payment of debts.

The total membership by Government Program for 2019 stands at 3.3 billion, down 17% year over year.

During the second quarter, Molina Healthcare received $345 million of dividends from regulated health plan subsidiaries.

Molina Healthcare, Inc Price, Consensus and EPS Surprise

Molina Healthcare, Inc Price, Consensus and EPS Surprise

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

Financial Update

As of Jun 30, 2019, Molina Healthcare’s cash and cash equivalents saw a reduction of 20.3% to $2.2 billion from the level at year-end 2018.

Total assets fell 6.5% from 2018 end to $6.7 billion.

The company’s shareholder equity improved nearly 5.4% from the figure at year-end 2018 to $1.7 billion.

For the first half of 2019, net cash outflow from operating activities stands at $156 million due to the government payment timing.

2019 Guidance

Following second-quarter results, the company hiked its 2019 outlook. It now expects its earnings in the range of 11.20-$11.50 per share, up from the prior estimate of $10.50 to $11.

Zacks Rank

Molina Healthcare sports a Zacks Rank #1 (Strong Buy).  You can see the complete list of today’s Zacks #1 Rank stocks here.

Releases From the Medical Sector

Among other players from the medical sector having reported second-quarter earnings so far, the bottom-line results of UnitedHealth Group Incorporated UNH, Anthem Inc. ANTM and Centene Corporation CNC outpaced the respective Zacks Consensus Estimate.

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