Centene Corporation operates as a healthcare enterprise that provides programs and services to under-insured and uninsured families, commercial organizations, and military families in the United States. The company operates through Medicaid, Medicare, Commercial, and Other segments. The Medicaid segment offers health plan coverage, including medicaid expansion, aged, blind, disabled, children's health insurance program, foster care, medicare-medicaid plans, long-term services and support. This segment also provides healthcare products. The Medicare segment offers special needs and medicare supplement, and prescription drug plans. The Commercial segment provides health insurance marketplace product for individual, small, and large group commercials. It also operates clinical healthcare and pharmacies, as well as offers dental and speech therapy services. In addition, the company engages in the government contracts business under the TRICARE program and other healthcare related government contracts. It provides services through primary and specialty care physicians, hospitals, and ancillary providers. Centene Corporation was founded in 1984 and is headquartered in Saint Louis, Missouri.

Centene выглядит как крупный и недорогой по мультипликаторам страховщик, но качество текущей прибыли и рентабельности заметно слабее, чем хотелось бы для более агрессивной переоценки. P/S 0.10, P/B 1.25 и P/FCF 7.75 находятся существенно ниже медианы отрасли, что поддерживает идею недооценки, однако это частично компенсируется слабой маржинальностью и нестабильностью результатов. P/E формально очень низкий, но TTM значение обнулено, поэтому этот сигнал нельзя трактовать как полноценный аргумент в пользу сильного роста оценки. Выручка остаётся большой и в целом растёт по годам, что говорит о масштабe бизнеса и устойчивом спросе на услуги. При этом валовая маржа снизилась до 7.12% с уровней около 10% годом ранее, а операционная и чистая маржа в TTM также выглядят слабо, что ограничивает потенциал расширения мультипликаторов. ROE, ROA и ROI в TTM равны нулю, тогда как в предыдущие периоды были положительными, и это указывает на просадку эффективности капитала. Долговая нагрузка по debt/equity 0.76 не выглядит критической для сектора, но она выше отраслевой медианы и не даёт сильного буфера для переоценки. Ликвидность смешанная: current ratio 1.30 приемлем, но quick ratio равен нулю, что повышает осторожность в оценке краткосрочной устойчивости. Денежная позиция сильная по абсолютной величине, cash on hand почти 19.2 млрд, и это поддерживает финансовую гибкость компании. Собственный капитал и net worth остаются значительными, но снижение equity по сравнению с прошлыми кварталами выглядит как фактор риска для качества баланса. В сумме фундаментал скорее подтверждает умеренно положительный взгляд на справедливую стоимость, но не оправдывает заметное повышение целевой цены. Для инвестора это история про крупный бизнес с дешёвой оценкой и хорошей выручкой, но с ослабленной рентабельностью и неидеальным балансом, поэтому пересмотр прогноза должен быть осторожным.

Centene Corporation

Сильный индекс, без изменений. Быки в растерянности.

Strong index, flat. The bulls are confused.

Сильный индекс, значительно упал. Медведи в растерянности.

Strong index, significantly down. The bears are confused.

Средний индекс, незначительно упал. Рынок на стороне быков.

Medium index, slightly down. The market is on the bulls' side.

Средний индекс, незначительно вырос. Рынок не поддерживает медведей.

Medium index, slightly up. The market does not support the bears.

Слабый индекс, незначительно упал. Приток средств в лонги остался положительным, но снизился.

Weak index, slightly down. The inflow of funds into longs remained positive, but decreased.

Слабый индекс, незначительно вырос

Centene выглядит недооценённой по мультипликаторам, но слабая рентабельность и просадка эффективности капитала ограничивают потенциал переоценки.

In the latest look at the underlying components of the S&P 500 ordered by largest market capitalization, Centene Corp (Symbol: CNC) has taken over the #296 spot from Workday Inc (Symbol: WDAY), according to The Online Investor.
Market capitalization is an important data point for investors to keep an eye on, for various reasons. The most basic reason is that it gives a true comparison of the value attributed by the stock market to a given company's stock. Many beginning investors look at one stock trading at $10 and another trading at $20 and mistakenly think the latter company is worth twice as much — that of course is a completely meaningless comparison without knowing how many shares of each company exist. But comparing market capitalization (factoring in those share counts) creates a true "apples-to-apples" comparison of the value of two stocks. In the case of Centene Corp (Symbol: CNC), the market cap is now $31.38 billion, versus Workday Inc (Symbol: WDAY) at $26.24 billion.
Below is a chart of Centene Corp versus Workday Inc plotting their respective size rank within the S&P 500 over time (CNC plotted in blue; WDAY plotted in green):
Below is a three month price history chart comparing the stock performance of CNC vs. WDAY:
Another reason market capitalization is important is where it places a company in terms of its size tier in relation to peers — much like the way a mid-size sedan is typically compared to other mid-size sedans (and not SUV's). This can have a direct impact on which mutual funds and ETFs are willing to own the stock. For instance, a mutual fund that is focused solely on Large Cap stocks may for example only be interested in those companies sized $10 billion or larger. Another illustrative example is the S&P MidCap index which essentially takes the S&P 500 index and "tosses out" the biggest 100 companies so as to focus solely on the 400 smaller "up-and-comers" (which in the right environment can outperform their larger rivals). So a company's market cap, especially in relation to other companies, carries great importance, and for this reason we at The Online Investor find value to putting together these rankings daily.
Examine the full CNC market cap history vs. the full WDAY market cap history.
At the closing bell, CNC is up about 2.5%, while WDAY is up about 0.2% on the day Friday.
Further CNC Research:
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Centene Moves Up In Market Cap Rank, Passing Workday

Molina Healthcare, Inc. MOH received a significant boost after the Illinois Department of Healthcare and Family Services announced its intent to award a HealthChoice Illinois Medicaid Managed Care contract to the company's state subsidiary. The contract is scheduled to begin on Jan. 1, 2027, with an initial term of approximately 4.5 years and extension options of up to an additional 5.5 years, ensuring Molina's continued participation in one of the nation's largest Medicaid markets.
The award secures Molina's place among six health plans selected to participate in Illinois' Medicaid managed care program, serving roughly 3.1 million beneficiaries. As one of the largest Medicaid markets in the country, Illinois represents an important growth and retention opportunity for managed care organizations. Maintaining a presence in the state helps Molina protect a key source of membership and revenues within its largest business segment.
The development comes as Molina continues to navigate industrywide Medicaid enrollment challenges. The company ended the first quarter of 2026 with approximately 4.6 million Medicaid members. By retaining access to Illinois' Medicaid program, Molina reduces the risk of member attrition in a major market while preserving opportunities for future enrollment growth. The award also highlights MOH’s strong competitive position in Medicaid managed care.
While the contract is unlikely to affect near-term earnings since it will not take effect until 2027, it supports Molina's long-term business stability. Coupled with the company's solid 92.0% Medicaid medical care ratio in the first quarter of 2026, the award underscores the resilience of its core Medicaid business and reinforces confidence in its long-term growth prospects.
MOH’s Price Performance
Molina’s shares have gained 11.4% year to date compared with 23.5% growth of the industry.
Image Source: Zacks Investment Research
Zacks Rank & Other Stocks to Consider
Molina currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Medical space are Centene Corporation CNC, sporting a Zacks Rank #1 (Strong Buy) at present, and Pediatrix Medical Group, Inc. MD and CVS Health Corporation CVS, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Centene’s 2026 earnings is pegged at $3.47 per share, indicating 66.8% year-over-year growth. It has witnessed nine upward revisions in the past 60 days, with no movement in the opposite direction. CNC beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 74.9%.
The Zacks Consensus Estimate for Pediatrix Medical’s 2026 bottom line suggests 9.3% year-over-year growth. MD has witnessed four upward estimate revisions over the past 60 days against no movement in the opposite direction. It beat earnings estimates in three of the last four quarters and missed once, delivering an average surprise of 21.3%.
The Zacks Consensus Estimate for CVS Health’s 2026 bottom line suggests 10.2% year-over-year growth. CVS has witnessed 12 upward estimate revisions over the past 60 days against no movement in the opposite direction. It beat earnings estimates in each of the last four quarters, delivering an average surprise of 16.8%.
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MOH Wins Illinois Medicaid Contract, Reinforcing Long-Term Stability

The Ensign Group, Inc. ENSG remains well positioned to benefit from favorable demographic and post-acute care trends, supported by rising occupancy and patient volumes. Headquartered in San Juan Capistrano, CA, the company operates through its Skilled Services and Standard Bearer segments.
Following recent acquisitions, Ensign's portfolio has expanded to approximately 396 healthcare operations, including 48 senior living operations, across 17 states. It holds a market capitalization of around $9.14 billion. ENSG has risen 3.9% over the past year compared with the industry’s average gain of 4.1%. ENSG currently holds a Zacks Rank #3 (Hold).
Where Do Estimates for ENSG Stand?
The Zacks Consensus Estimate for Ensign Group’s 2026 earnings is pegged at $7.48 per share, indicating a 13.9% year-over-year rise. The consensus mark for revenues is pegged at $5.82 billion for 2026, implying 15% year-over-year growth. It beat earnings estimates in each of the past four quarters, with an average surprise of 3.4%.
The Ensign Group, Inc. Price, Consensus and EPS Surprise
ENSG’s Growth Drivers
Ensign continues to benefit from robust demand for post-acute care services, translating into higher patient volumes and occupancy gains. In the first quarter of 2026, same-store occupancy improved 190 basis points year over year to 84.3%, while transitioning-facility occupancy increased 310 basis points to 85.1%. Skilled revenues and skilled patient days at transitioning operations rose 9.6% and 8.5%, respectively, reflecting strong underlying demand and successful operational integration.
Strategic acquisitions remain a core growth pillar for Ensign. The company added five stand-alone skilled nursing operations in the first quarter of 2026 and signed agreements for 17 additional facilities. Its proven ability to integrate acquisitions, improve clinical performance and strengthen referral relationships supports higher occupancy, patient volumes and earnings growth. Ensign's ROIC of 8.1% significantly exceeds the industry average of 3.1%, highlighting the effectiveness of its growth strategy and capital allocation.
Beyond operating skilled nursing facilities, Ensign continues to expand its real estate portfolio through its Standard Bearer segment. As of March 31, 2026, the company owned 160 real estate assets, providing greater control over occupancy costs and creating an additional stream of rental income primarily from its own operating subsidiaries. During the first quarter of 2026, Standard Bearer rental revenues increased 27.1% year over year to $36.1 million, while segment income rose 25.9%. ENSG's strategy of pairing healthcare operations with selective real estate ownership strengthens cash-flow generation enhances returns on acquisitions, and provides another powerful avenue for long-term earnings growth.
Ensign's balance sheet remains a competitive advantage. The company ended the first quarter of 2026 with $539.5 million in cash and cash equivalents against only $136.5 million in long-term debt. It had approximately $592 million of available borrowing capacity under its revolving credit facility. Strong operating cash flow of $100.2 million provides ample flexibility to fund acquisitions, invest in existing operations and pursue real estate purchases without materially increasing leverage. Additionally, $20 million remained available under its share repurchase authorization as of March 31, 2026. Reflecting its conservative financial profile, total debt represented just 5.6% of capital, substantially below the industry average of 89.3%.
ENSG: Risks to Watch
There are some factors, however, that investors should keep a careful eye on.
Ensign remains exposed to reimbursement uncertainty, as Medicare and Medicaid accounted for 69.1% of service revenues in the first quarter of 2026. Consequently, changes in reimbursement rates, regulatory policies or payer reviews could adversely impact profitability. Competition for acquisitions, labor and patient referrals remains intense across the fragmented post-acute care industry. Heightened competitive pressures could increase operating costs, raise acquisition multiples and constrain occupancy growth.
Ensign has experienced steady cost inflation in recent years, driven primarily by higher service and rent expenses. Total expenses increased 12.3% in 2024 and 18.7% in 2025, followed by an 18.0% year-over-year rise to $1.26 billion in the first quarter of 2026. If expense growth continues to outpace revenue gains, it could pressure margins and limit earnings growth.
Stocks to Consider
Some better-ranked stocks in the broader Medical space are Indivior Pharmaceuticals, Inc. INDV, Centene Corporation CNC and BrightSpring Health Services, Inc. BTSG, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Indivior Pharmaceuticals’ 2026 earnings is pegged at $4.05 per share, indicating a 62% year-over-year improvement. INDV beat earnings estimates in each of the trailing four quarters, with the average surprise being 65.44%. The consensus estimate for 2026 revenues is pinned at $1.26 billion, implying 1.5% year-over-year growth.
The Zacks Consensus Estimate for Centene’s 2026 earnings is pegged at $3.47 per share, indicating 66.8% year-over-year growth. It has witnessed nine upward revisions in the past 60 days, with no movement in the opposite direction. CNC beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 74.9%. The consensus estimate for 2026 revenues is pinned at $191.03 billion.
The Zacks Consensus Estimate for BrightSpring Health’s 2026 earnings is pegged at $1.67 per share, which has witnessed five upward revisions in the past 60 days, with no movement in the opposite direction. BTSG beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 14.6%. The consensus estimate for 2026 revenues is pinned at $15.05 billion, implying 16.6% year-over-year growth.
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Here's Why Investors Continue to Hold Ensign Group Stock

Centene and UFP Industries have been highlighted as Zacks Bull and Bear of the Day

Centene Corporation, a Zacks Rank #1 (Strong Buy), has staged one of the more impressive turnarounds in the healthcare space over the past year.
After a difficult 2025 that saw the stock fall out of favor amid elevated medical costs, the managed care giant has come roaring back, supported by recovering margins, surging cash flow, and a powerful wave of upward earnings estimate revisions. The company is a leading provider of government-sponsored healthcare, with a dominant position in Medicaid and a rapidly expanding Medicare footprint.
The stock has rebounded sharply off its 2025 lows and now trades near its 52-week high on increasing volume. Shares continue to display relative strength as buying pressure accumulates in this resurgent market leader.
Centene is part of the Zacks Medical – HMOs industry group, which currently ranks in the top 10% out of approximately 250 Zacks Ranked Industries. Because it is ranked in the top half of all Zacks Ranked Industries, we expect this group to outperform over the next 3 to 6 months, just as it has begun to in recent months:
Image Source: Zacks Investment Research
Take note of the favorable characteristics for this group below. The industry’s improving positioning has been driven by a positive earnings outlook for its constituent companies in aggregate, along with relative undervaluation — a powerful combination that should lead to higher prices in the future.
Image Source: Zacks Investment Research
Historical research studies suggest that approximately half of a stock’s price appreciation is due to its industry grouping. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
It’s no secret that investing in stocks that are part of leading industry groups can give us a leg up relative to the market. By focusing on leading stocks within the top 50% of Zacks Ranked Industries, we can dramatically improve our stock-picking success.
Company Description
Centene operates as a diversified, multi-national healthcare enterprise that primarily serves under-insured and uninsured individuals through government-sponsored programs. The company operates through four segments — Medicaid, Medicare, Commercial, and Other — and ranks among the largest healthcare companies in the country, with approximately $191 billion in total projected revenues and a spot at No. 19 on the Fortune 500. It is also engaged in providing education and outreach programs that help members access quality, appropriate care.
After navigating a challenging 2025 marked by rising medical costs and a withdrawal of guidance that battered the stock, Centene has executed a methodical recovery. Management’s relentless focus on Medicaid margin restoration, disciplined cost management, and rate adequacy is clearly bearing fruit, while the Medicare Advantage and prescription drug plan businesses have outperformed internal expectations.
The Texas Medicaid expansion has added a meaningful new growth vector, and the company has used its robust cash generation — $4.4 billion of operating cash flow in the most recent quarter — to fortify the balance sheet, reducing total debt by $1 billion in the first quarter alone. The consolidated health benefits ratio has been steadily improving, a key signal that the worst of the medical-cost pressure may be in the rearview mirror.
Earnings Trends and Future Estimates
What stands out is Centene’s renewed ability to deliver eye-catching earnings surprises. The company most recently reported first-quarter 2026 results that blew past expectations, posting adjusted EPS of $3.37 — a figure that surpassed the Zacks Consensus Estimate by a remarkable 80.2% and climbed 16.2% from the year-ago period.
Revenues of $49.9 billion rose 7.1% year over year and topped the consensus mark by 5.2%. The company has now topped consensus revenue estimates in each of the past four quarters and exceeded EPS expectations in three of the last four. This track record aligns perfectly with the power of the Zacks Rank system, which prioritizes stocks showing upward earnings revisions.
On the heels of that beat, management raised its full-year 2026 adjusted EPS guidance to greater than $3.40, up from a prior floor of greater than $3.00, and lifted its total revenue outlook to a band of $187.5–$191.5 billion.
Analysts have responded enthusiastically: the Zacks Consensus Estimate for the current year has surged 15.28% over the past 60 days. That consensus now stands at $3.47 per share, reflecting an enormous 66.8% increase relative to the prior-year figure. Notably, the stock screens as deeply undervalued even after its rally, carrying a PEG ratio of just 0.51 versus the industry’s 1.12 and a top Zacks Growth Style Score of A.
Image Source: Zacks Investment Research
Let’s Get Technical
Centene CNC has transitioned from a falling knife in 2025 into one of the better recovery stories in the market today. After bottoming last year near $25, shares have more than doubled and now trade near their 52-week high. This is exactly the kind of stock we want to include in our portfolio — one that is trending well and receiving positive earnings estimate revisions.
Image Source: StockCharts
Notice how shares now reside above upward-sloping 50-day (blue line) and 200-day (red line) moving averages, a hallmark of a healthy uptrend. The momentum has clearly built throughout 2026. With both improving fundamentals and a constructive technical picture, Centene appears poised to continue its outperformance.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, Centene has recently witnessed sharp upward revisions. As long as this trend remains intact (and CNC continues to deliver earnings beats), the stock will likely continue its bullish run.
Bottom Line
Backed by a leading industry group and a renewed history of earnings beats, it’s not difficult to see why this turnaround story is a compelling investment. Currently, CNC carries a Zacks Rank #1 (Strong Buy), driven by powerful estimate momentum.
The combination of Medicaid margin recovery, Medicare outperformance, improving cash flow, and a discounted valuation should continue to provide a tailwind for the stock price. With the next earnings report expected in late July, robust fundamentals combined with a strengthening technical trend certainly justify adding shares to the mix. If you haven’t already done so, be sure to put CNC on your watchlist.
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Bull of the Day: Centene (CNC)

Teladoc Health, Inc. TDOC is a pioneer and global leader in the telemedicine industry. It has a broad international presence, serving clients, supporting medical operations and reaching members worldwide. TDOC operates through two main segments — Integrated Care and BetterHelp. It serves markets across North America, South America, Europe, Asia-Pacific and the Middle East.
The stock has gained 4.5% year to date, outperforming its industry, which has declined 7.6% over the same period. In comparison, the Zacks Medical sector has fallen 4.5%, while the S&P 500 has advanced 11%.
Zack’s Rank and Valuation of TDOC
Teladoc currently carries a Zacks Rank #3 (Hold).
With a market capitalization of approximately $1.3 billion, TDOC trades at a forward price-to-sales (P/S) ratio of 0.53X, above the industry average of 0.47X. Despite this modest premium, the company's valuation remains attractive, supported by its strong relative performance and Value Score of B.
Where Do Estimates for TDOC Stand?
The consensus estimate for 2026 loss is pegged at 92 cents per share, suggesting a 19.3% year-over-year increase. The consensus estimate for 2026 revenues is pinned at $2.51 billion. TDOC beat earnings estimates in three of the trailing four quarters and missed once, delivering an average surprise of 15.7%.
Teladoc Health, Inc. Price, Consensus and EPS Surprise
Business Tailwinds for TDOC
Teladoc's Integrated Care business continues to provide stability amid challenges in other segments. Integrated Care revenues in first-quarter 2026 increased 2% year over year to $395.4 million, while adjusted EBITDA rose 12%. The segment also delivered margin expansion, underscoring strong execution and sustained demand for virtual healthcare services.
International operations remain a bright spot for Teladoc. Revenues from International operations grew 12.3% in 2024, 12% in 2025 and 17% year over year in the first quarter of 2026, reflecting sustained double-digit growth. Continued expansion in overseas markets and rising adoption of hybrid care models provide the company with a meaningful growth opportunity beyond the increasingly competitive U.S. market.
Teladoc continues to strengthen its platform through product innovation and strategic acquisitions. Recent launches, including enhancements to the Prism platform, the Cardiometabolic Program and Wellbound, broaden the company's service portfolio. At the same time, acquisitions such as Catapult Health and Telecare Australia expand its capabilities in preventive care, diagnostics and international healthcare delivery.
Teladoc is showing improved cost discipline, with total expenses declining 22.2% in 2025 and 9.9% year over year in the first quarter of 2026. Ongoing efficiency initiatives are supporting margins, and management projects adjusted EBITDA of $267-$306 million for 2026. Collectively, these trends suggest a clearer path toward profitability.
Key Risks to Consider
Despite its growth potential, there are a few concerns that investors should consider.
The BetterHelp segment, once a major growth engine for Teladoc, remains under pressure. Segment revenues declined 8.7% in 2025 and fell another 9% year over year in the first quarter of 2026, reflecting softer consumer demand and increased adoption of insurance-covered therapy services. Management expects BetterHelp revenues to decline 1-6.5% in 2026, indicating that challenges are likely to persist in the near term.
Teladoc faces intense competition in the virtual care market, which could pressure pricing and growth. The company also remains unprofitable, reporting an accumulated deficit of $16.5 billion as of March 31, 2026, largely due to substantial investments in growth initiatives and technology.
Key Picks
Some better-ranked stocks in the Medical space are Centene Corporation CNC, The Joint Corp. JYNT and Indivior Pharmaceuticals, Inc. INDV, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Centene’s 2026 earnings is pegged at $3.47 per share, indicating 66.8% year-over-year growth. It has witnessed nine upward revisions in the past 60 days, with no movement in the opposite direction. CNC beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 74.9%. The consensus estimate for 2026 revenues is pinned at $191.03 billion.
The Zacks Consensus Estimate for Joint’s 2026 earnings is pegged at 51 cents per share, which has witnessed two upward revisions in the past 30 days, with no movement in the opposite direction. JYNT beat earnings estimates in each of the trailing four quarters, with the average surprise being 125.2%. The consensus estimate for 2026 revenues is pinned at $61.11 million, indicating an 11.3% year-over-year increase.
The Zacks Consensus Estimate for Indivior Pharmaceuticals’ 2026 earnings is pegged at $4.05 per share, indicating a 62% year-over-year improvement. INDV beat earnings estimates in each of the trailing four quarters, with the average surprise being 65.4%. The consensus estimate for 2026 revenues is pinned at $1.26 billion, implying 1.5% year-over-year growth.
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Here's Why Investors Should Hold on to Teladoc Health Stock for Now

The S&P 500 Index ($SPX) (SPY) on Thursday closed up +0.41%, the Dow Jones Industrial Average ($DOWI) (DIA) closed up +1.73%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed down -0.53%. June E-mini S&P futures (ESM26) rose +0.36%, and June E-mini Nasdaq futures (NQM26) fell -0.47%.
Stock indexes settled mixed on Thursday, with the Dow Jones industrials posting a new all-time high. The overall market shook off early weakness on Thursday and pushed higher as a -3% plunge in crude oil prices knocked T-note yields lower, with the 10-year T-note yield falling -2 bp to 4.47%. Also, the rally in bank stocks and managed healthcare companies lifted the broader market, pushing the Dow Jones Industrial Average to a new record high.
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The weakness in technology stocks on Thursday weighed on the broader market, keeping the Nasdaq 100 in negative territory. Broadcom fell more than -12% to lead chipmakers lower after its forecast for artificial-intelligence revenue in the current quarter fell short of expectations. Also, CrowdStrike Holdings closed down more than -3% to lead cybersecurity stocks lower, despite reporting better-than-expected Q1 earnings, as the report wasn’t strong enough to lift the stock, which has more than doubled from a March low.
Weaker crude oil prices are a positive factor for stocks and bonds, as WTI crude oil fell more than -3% on Thursday after the US late Wednesday said Israel and Lebanon agreed to a ceasefire if Hezbollah also stops fighting and withdraws militants from areas near the border with Israel. Iran insists a peace deal with the US requires a ceasefire in Lebanon. The agreement would require the Lebanese army to take over after the withdrawal of Israeli troops. However, Hezbollah militants said they refused to abide by the conditions of the ceasefire announced by the US State Department, and clashes continued in southern Lebanon. Iranian Foreign Minister Abbas Araghchi said that “Communications between Iran and the US have not been cut off, but no tangible progress has been achieved in the negotiating process.”
Thursday’s US economic news was mixed for stocks after weekly jobless claims rose more than expected to a 3.75-month high and Q1 nonfarm productivity was revised lower. Conversely, Q1 unit labor costs were unexpectedly revised lower, easing concerns over wage pressures.
US weekly initial unemployment claims rose +13,000 to a 3.75-month high of 225,000, showing a weaker labor market than expectations of 215,000.
US Q1 nonfarm productivity was revised downward to 0.3% from the previously reported 0.8%, weaker than expectations of 0.4%. Q1 unit labor costs were unexpectedly revised downward to 1.8% from 2.3%, weaker than expectations of an upward revision to 2.4%.
The markets are discounting a 2% chance of a +25 bp rate hike at the next FOMC meeting on June 16-17.
The generally favorable Q1 earnings season is winding down. As of Thursday, 83% of the 494 S&P 500 companies that reported Q1 earnings have beaten estimates. Q1 S&P 500 earnings are projected to climb +12% y/y, according to Bloomberg Intelligence. Stripping out the technology sector, Q1 earnings are projected to increase around +3%, the weakest in two years.
Overseas stock markets settled mixed on Thursday. The Euro Stoxx 50 closed up +0.82%. China's Shanghai Composite closed down -0.64%. Japan's Nikkei Stock Average closed down -1.36%.
Interest Rates
September 10-year T-notes (ZNU6) on Thursday closed up +4.5 ticks, and the 10-year T-note yield fell -2.4 bp to 4.471%. T-note prices moved higher on Thursday, supported by a -3% decline in WTI crude oil prices, which has lowered inflation expectations. The 10-year breakeven inflation rate fell to a 6-week low of 2.365% on Thursday. Fed-friendly US economic news was also positive for T-notes, following weekly jobless claims that rose more than expected and Q1 unit labor costs that were unexpectedly revised lower. T-notes fell back from their best level as stocks rebounded, dampening safe-haven demand for government debt securities.
European government bond yields moved lower on Thursday. The 10-year German Bund yield fell from a 1.5-week high of 3.043% and finished down -1.3 bp to 3.023%. The 10-year UK gilt yield fell -3.3 bp to 4.898%.
Eurozone Apr retail sales fell -0.4% m/m, weaker than expectations of -0.3% m/m.
Swaps are discounting a 98% chance of a +25 bp ECB rate hike at its next policy meeting on June 11.
US Stock Movers
Humana (HUM) closed up more than +6% to lead managed healthcare stocks higher and gainers in the S&P 500 after Morgan Stanley raised its price target on the stock to $240 from $217. Also, Centene (CNC) closed up more than +5%, and UnitedHealth Group (UNH) closed up more than +5% to lead gainers in the Dow Jones Industrials after Bank of America Global Research upgraded the stock to buy from neutral with a price target of $450. In addition, Elevance Health (ELV) and Molina Healthcare(MOH) closed up more than +4%, and Cigna Group (CI) and CVS Health (CVS) closed up more than +3%. Finally, Cardinal Health (CAH) closed up more than +2%.
Asset managers and bank stocks rallied on Thursday, lifting the broader market. Blackstone (BX) closed up more than +7% to lead gainers in the S&P 500, and Franklin Resources (BEN) closed up more than +5%. Also, Goldman Sachs (GS), Fifth Third Bank (FITB), and US Bancorp (USB) closed up more than +4%. In addition, JPMorgan Chase (JPM), Morgan Stanley (MS), Citigroup (C), Wells Fargo (WFC), Citizens Financial Group (CFG), M&T Bank (MTB), and BlackRock (BLK) closed up more than +3%.
Chipmakers and AI-infrastructure stocks retreated on Thursday, led by a -12% plunge in Broadcom (AVGO), the largest decliner in the Nasdaq 100, after giving an outlook that was seen as underwhelming, given the industry’s AI-related demand. Also, Micron Technology (MU) closed down more than -7%, and ARM Holdings Plc (ARM) closed down more than -4%. In addition, Advanced Micro Devices (AMD), Qualcomm (QCOM), Sandisk (SNDK), and Western Digital (WDC) closed down more than -3%, and Lam Research (LRCX) and Analog Devices (ADI) closed down more than -2%.
Medtronic Plc (MDT) closed up more than +5% after BTIG LLC upgraded the stock to buy from neutral with a price target of $90.
RTX Corp (RTX) closed up +4% after Jeffries upgraded the stock to buy from hold with a price target of $220.
Alnylam Pharmaceuticals (ALNY) closed up more than +3% to lead gainers in the Nasdaq 100 after entering into a strategic AI collaboration with Inceptive Nucleics valued at up to $2 billion to accelerate the discovery and design of RNAi therapeutics.
Brown-Forman (BF.B) closed up more than +2% after reporting Q4 gross margin of 62.6%, stronger than the consensus of 57.5%.
Zoetis (ZTS) closed up more than +2% after KeyBanc Capital Markets said the cattle screwworm parasite could be a potential catalyst for the company’s livestock portfolios, as it has approved medications to prevent and treat the parasite in livestock.
PVH Corp (PVH) closed down more than -20% after forecasting 2027 adjusted EPS of $11.80 to $12.10, weaker than the consensus of $12.24.
Ciena Corp (CIEN) closed down more than -13% to lead losers in the S&P 500 despite reporting better-than-expected Q2 earnings, as Bloomberg Intelligence said the company’s full-year sales outlook may be viewed as underwhelming amid heightened expectations.
Five Below (FIVE) closed down more than -13% despite reporting stronger-than-expected Q1 earnings results, as Jeffries said the company’s growth rate might be peaking.
CrowdStrike Holdings (CRWD) closed down more than -3% after its Q1 earnings beat wasn’t strong enough to lift the stock, which has more than doubled from a March low.
AT&T (T) closed down more than -3% and Verizon Communications (VZ) closed down more than -3% to lead losers in the Dow Jones Industrials after the US Supreme Court ruled that telecommunications companies can’t immediately demand a jury trial when hit with a Federal Communications Commission fine.
Earnings Reports(6/5/2026)
ABM Industries Inc (ABM), G-III Apparel Group Ltd (GIII), Lifezone Metals Ltd (LZM).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Stocks Rebound on Strength in Banks and Managed Healthcare

The S&P 500 Index ($SPX) (SPY) today is up +0.02%, the Dow Jones Industrial Average ($DOWI) (DIA) is up +1.49%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.90%. June E-mini S&P futures (ESM26) are up +0.02%, and June E-mini Nasdaq futures (NQM26) are down -0.86%.
Stock indexes are mixed today, with the Dow Jones industrials posting a new all-time high. The broader market is under pressure today amid weakness in technology stocks. Broadcom is down more than -14% to lead chipmakers lower after its forecast for artificial-intelligence revenue in the current quarter fell short of expectations. Also, CrowdStrike Holdings is down more than -8% to lead cybersecurity stocks lower, despite reporting better-than-expected Q1 earnings, as the report wasn’t strong enough to lift the stock, which has more than doubled from a March low. However, the strength in managed healthcare stocks today is limiting overall market losses and helping push the Dow Jones Industrial Average to a new record high.
Join 200K+ Subscribers: Find out why the midday Barchart Brief newsletter is a must-read for thousands daily.
Weaker crude oil prices are a positive factor for stocks and bonds, with WTI crude oil down more than -3% today after the US late Wednesday said Israel and Lebanon agreed to a ceasefire if Hezbollah also stops fighting and withdraws militants from areas near the border with Israel. The agreement would require the Lebanese army to take over after the withdrawal of Israeli troops. Iran insists a deal with the US requires a ceasefire in Lebanon. Iranian Foreign Minister Abbas Araghchi said that “Communications between Iran and the US have not been cut off, but no tangible progress has been achieved in the negotiating process.”
Today’s US economic news was mixed for stocks after weekly jobless claims rose more than expected to a 3.75-month high and Q1 nonfarm productivity was revised lower. Conversely, Q1 unit labor costs were unexpectedly revised lower, easing concerns over wage pressures.
US weekly initial unemployment claims rose +13,000 to a 3.75-month high of 225,000, showing a weaker labor market than expectations of 215,000.
US Q1 nonfarm productivity was revised downward to 0.3% from the previously reported 0.8%, weaker than expectations of 0.4%. Q1 unit labor costs were unexpectedly revised downward to 1.8% from 2.3%, weaker than expectations of an upward revision to 2.4%.
The markets are discounting a 2% chance of a +25 bp rate hike at the next FOMC meeting on June 16-17.
The generally favorable Q1 earnings season is winding down. As of today, 84% of the 485 S&P 500 companies that reported Q1 earnings have beaten estimates. Q1 S&P 500 earnings are projected to climb +12% y/y, according to Bloomberg Intelligence. Stripping out the technology sector, Q1 earnings are projected to increase around +3%, the weakest in two years.
Overseas stock markets are mixed today. The Euro Stoxx 50 is up +0.51%. China's Shanghai Composite closed down -0.64%. Japan's Nikkei Stock Average closed down -1.36%.
Interest Rates
September 10-year T-notes (ZNU6) today are up +8 ticks, and the 10-year T-note yield is down -3.6 bp to 4.459%. T-note prices are moving higher today, supported by a -2% decline in WTI crude oil prices, which has lowered inflation expectations. The 10-year breakeven inflation rate fell to a 6-week low of 2.366% today. Fed-friendly US economic news was also positive for T-notes, following weekly jobless claims that rose more than expected and Q1 unit labor costs that were unexpectedly revised lower.
European government bond yields are moving lower today. The 10-year German Bund yield fell from a 1.5-week high of 3.043% and is down -1.5 bp to 3.021%. The 10-year UK gilt yield is down -2.7 bp to 4.904%.
Eurozone Apr retail sales fell -0.4% m/m, weaker than expectations of -0.3% m/m.
Swaps are discounting a 98% chance of a +25 bp ECB rate hike at its next policy meeting on June 11.
US Stock Movers
Chipmakers and AI-infrastructure stocks are slumping today, led by a -14% plunge in Broadcom (AVGO), the largest decliner in the Nasdaq 100, after giving an outlook that was seen as underwhelming, given the industry’s AI-related demand. Also, Micron Technology (MU) is down more than -8%, and ARM Holdings Plc (ARM) is down more than -5%. In addition, Advanced Micro Devices (AMD), Qualcomm (QCOM), Sandisk (SNDK), and Lam Research (LRCX) are down more than -3%. Finally, Western Digital (WDC), Seagate Technology Holdings Plc (STX), Analog Devices (ADI), KLA Corp (KLAC), and Intel (INTC) are down more than -2%.
Cryptocurrency-exposed stocks are falling today, with Bitcoin (^BTCUSD) down more than -1% at a 3.75-month low. Galaxy Digital Holdings (GLXY) is down more than -5%, MARA Holdings (MARA) is down more than -4%, and Riot Platforms (RIOT) is down more than -3%. Also, Coinbase Global (COIN) is down -0.28%.
Humana (HUM) is up more than +7% to lead managed healthcare stocks higher and gainers in the S&P 500 after Morgan Stanley raised its price target on the stock to $240 from $217. Also, Centene (CNC) is up more than +6%, and UnitedHealth Group (UNH) is up more than +5% to lead gainers in the Dow Jones Industrials after Bank of America Global Research upgraded the stock to buy from neutral with a price target of $450. In addition, Elevance Health (ELV), Cigna Group (CI), and Molina Healthcare(MOH) are up more than +4%, and CVS Health (CVS) and Cardinal Health (CAH) are up more than +2%.
PVH Corp (PVH) is down more than -24% after forecasting 2027 adjusted EPS of $11.80 to $12.10, weaker than the consensus of $12.24.
Ciena Corp (CIEN) is down more than -18% to lead losers in the S&P 500 despite reporting better-than-expected Q2 earnings, as Bloomberg Intelligence said the company’s full-year sales outlook may be viewed as underwhelming amid heightened expectations.
Five Below (FIVE) is down more than -13% despite reporting stronger-than-expected Q1 earnings results, as Jeffries said the company’s growth rate might be peaking.
CrowdStrike Holdings (CRWD) is down more than -7% after its Q1 earnings beat wasn’t strong enough to lift the stock, which has more than doubled from a March low.
Alnylam Pharmaceuticals (ALNY) is up more than +5% to lead gainers in the Nasdaq 100 after entering into a strategic AI collaboration with Inceptive Nucleics valued at up to $2 billion to accelerate the discovery and design of RNAi therapeutics.
Medtronic Plc (MDT) is up more than +4% after BTIG LLC upgraded the stock to buy from neutral with a price target of $90.
Zoetis (ZTS) is up more than +4% after KeyBanc Capital Markets said the cattle screwworm parasite could be a potential catalyst for the company’s livestock portfolios, as it has approved medications to prevent and treat the parasite in livestock.
RTX Corp (RTX) is up more than +3% after Jeffries upgraded the stock to buy from hold with a price target of $220.
Brown-Forman (BF.B) is up more than +1% after reporting Q4 gross margin of 62.6%, stronger than the consensus of 57.5%.
Earnings Reports(6/4/2026)
Brown-Forman Corp (BF/B), Ciena Corp (CIEN), Cooper Cos Inc/The (COO), Docusign Inc (DOCU), Guidewire Software Inc (GWRE), Lululemon Athletica Inc (LULU), Rubrik Inc (RBRK), Samsara Inc (IOT), Toro Co/The (TTC).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
More news from Barchart
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Stocks Mixed as Tech Weakness Weighs

The S&P 500 Index ($SPX) (SPY) today is down -0.16%, the Dow Jones Industrial Average ($DOWI) (DIA) is up +1.41%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -1.23%. June E-mini S&P futures (ESM26) are down -0.14%, and June E-mini Nasdaq futures (NQM26) are down -1.16%.
Stock indexes are mixed today, with the Dow Jones industrials posting a new all-time high. The broader market is under pressure today amid weakness in technology stocks. Broadcom is down more than -15% to lead chipmakers lower after its forecast for artificial-intelligence revenue in the current quarter fell short of expectations. Also, CrowdStrike Holdings is down more than 6% to lead cybersecurity stocks lower, despite reporting better-than-expected Q1 earnings, as the report wasn’t strong enough to lift the stock, which has more than doubled from a March low. Strength in managed healthcare stocks today is helping push the Dow Jones Industrial Average to a record high.
Join 200K+ Subscribers: Find out why the midday Barchart Brief newsletter is a must-read for thousands daily.
Weaker crude oil prices are a positive factor for stocks and bonds, with WTI crude oil down more than -3% today after the US late Wednesday said Israel and Lebanon agreed to a ceasefire if Hezbollah also stops fighting and withdraws militants from areas near the border with Israel. The agreement would require the Lebanese army to take over after the withdrawal of Israeli troops. Iran insists a deal with the US requires a ceasefire in Lebanon. Iranian Foreign Minister Abbas Araghchi said that “Communications between Iran and the US have not been cut off, but no tangible progress has been achieved in the negotiating process.”
Today’s US economic news was mixed for stocks after weekly jobless claims rose more than expected to a 3.75-month high and Q1 nonfarm productivity was revised lower. Conversely, Q1 unit labor costs were unexpectedly revised lower, easing concerns over wage pressures.
US weekly initial unemployment claims rose +13,000 to a 3.75-month high of 225,000, showing a weaker labor market than expectations of 215,000.
US Q1 nonfarm productivity was revised downward to 0.3% from the previously reported 0.8%, weaker than expectations of 0.4%. Q1 unit labor costs were unexpectedly revised downward to 1.8% from 2.3%, weaker than expectations of an upward revision to 2.4%.
The markets are discounting a 2% chance of a +25 bp rate hike at the next FOMC meeting on June 16-17.
The generally favorable Q1 earnings season is winding down. As of today, 84% of the 485 S&P 500 companies that reported Q1 earnings have beaten estimates. Q1 S&P 500 earnings are projected to climb +12% y/y, according to Bloomberg Intelligence. Stripping out the technology sector, Q1 earnings are projected to increase around +3%, the weakest in two years.
Overseas stock markets are mixed today. The Euro Stoxx 50 is up +0.51%. China's Shanghai Composite closed down -0.64%. Japan's Nikkei Stock Average closed down -1.36%.
Interest Rates
September 10-year T-notes (ZNU6) today are up +8 ticks, and the 10-year T-note yield is down -3.6 bp to 4.459%. T-note prices are moving higher today, supported by a -2% decline in WTI crude oil prices, which has lowered inflation expectations. The 10-year breakeven inflation rate fell to a 6-week low of 2.366% today. Fed-friendly US economic news was also positive for T-notes, following weekly jobless claims that rose more than expected and Q1 unit labor costs that were unexpectedly revised lower.
European government bond yields are moving lower today. The 10-year German Bund yield fell from a 1.5-week high of 3.043% and is down -1.5 bp to 3.021%. The 10-year UK gilt yield is down -2.7 bp to 4.904%.
Eurozone Apr retail sales fell -0.4% m/m, weaker than expectations of -0.3% m/m.
Swaps are discounting a 98% chance of a +25 bp ECB rate hike at its next policy meeting on June 11.
US Stock Movers
Chipmakers and AI-infrastructure stocks are slumping today, led by a -15% plunge in Broadcom (AVGO), the largest decliner in the Nasdaq 100, after giving an outlook that was seen as underwhelming, given the industry’s AI-related demand. Also, Micron Technology (MU), ARM Holdings Plc (ARM), and Marvell Technology (MRVL) are down more than -5%, and Applied Materials (AMAT) and Lam Research (LRCX) are down more than -3%. In addition, KLA Corp (KLAC), Intel (INTC), Qualcomm (QCOM), Analog Devices (ADI), and ASML Holding NV (ASML) are down more than -2%.
Cybersecurity stocks are retreating for a second day today, led by an -8% decline in CrowdStrike Holdings (CRWD) after its Q1 earnings beat wasn’t strong enough to lift the stock that has more than doubled from a March low. Also, Palo Alto Networks (PANW) and Cloudflare (NET) are down more than -2%, and Okta (OKTA) is down -0.83%.
Cryptocurrency-exposed stocks are falling today, with Bitcoin (^BTCUSD) down more than -1% at a 3.75-month low. Galaxy Digital Holdings (GLXY) is down more than -4%, and MARA Holdings (MARA) and Riot Platforms (RIOT) are down more than -3%. Also, Coinbase Global (COIN) is down -0.44%.
UnitedHealth Group (UNH) is up more than +6% to health insurance stocks higher and lead gainers in the S&P 500 and Dow Jones Industrials after Bank of America Global Research upgraded the stock to buy from neutral with a price target of $450. Also, Humana (HUM) is up more than +5%, and Centene (CNC) and Elevance Health (ELV) are up more than +4%. In addition, Cigna Group (CI) and CVS Health (CVS) are up more than +3%, and Cardinal Health (CAH) is up more than +2%.
PVH Corp (PVH) is down more than -27% after forecasting 2027 adjusted EPS of $11.80 to $12.10, weaker than the consensus of $12.24.
Ciena Corp (CIEN) is down more than -19% to lead losers in the S&P 500 despite reporting better-than-expected Q2 earnings, as Bloomberg Intelligence said the company’s full-year sales outlook may be viewed as underwhelming amid heightened expectations.
Five Below (FIVE) is down more than -10% despite reporting stronger-than-expected Q1 earnings results, as Jeffries said the company’s growth rate might be peaking.
Brown-Forman (BF.B) is up more than +4% after reporting Q4 gross margin of 62.6%, stronger than the consensus of 57.5%.
Medtronic Plc (MDT) is up more than +4% after BTIG LLC upgraded the stock to buy from neutral with a price target of $90.
RTX Corp (RTX) is up more than +3% after Jeffries upgraded the stock to buy from hold with a price target of $220.
Alnylam Pharmaceuticals (ALNY) is up more than +2% after entering into a strategic AI collaboration with Inceptive Nucleics valued at up to $2 billion to accelerate the discovery and design of RNAi therapeutics.
Earnings Reports(6/4/2026)
Brown-Forman Corp (BF/B), Ciena Corp (CIEN), Cooper Cos Inc/The (COO), Docusign Inc (DOCU), Guidewire Software Inc (GWRE), Lululemon Athletica Inc (LULU), Rubrik Inc (RBRK), Samsara Inc (IOT), Toro Co/The (TTC).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
More news from Barchart
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Weakness in Technology Stocks Pressures Stock Indexes

For Immediate Release
Chicago, IL – June 4, 2026 – Today, Zacks Equity Research discusses UnitedHealth Group Inc. UNH, The Cigna Group CI, Humana Inc. HUM, Centene Corp. CNC and Molina Healthcare, Inc. MOH.
Industry: Health Maintenance Organization (HMO)
Link: https://www.zacks.com/commentary/2931379/5-hmo-stocks-in-focus-amid-an-aging-us-population-tech-innovation
The U.S. health insurance industry, commonly referred to as the Health Maintenance Organization (HMO), benefits from a set of diversified, cost-effective plans that generate steady premium income and secure contract renewals. However, regulatory changes could tighten Medicaid eligibility and reduce ACA enrollment, affecting membership and reimbursements.
Demand for Medicare products should remain strong as the U.S. population ages, supporting enrollment and premium growth. Investments in telehealth, AI, cloud computing and data analytics are improving efficiency, patient engagement and long-term revenue prospects despite increasing near-term costs. HMOs are also pursuing strategic mergers and acquisitions (M&A) to expand market presence and diversify operations. Industry leaders such as UnitedHealth Group Inc., The Cigna Group, Humana Inc., Centene Corp. and Molina Healthcare, Inc. are well-positioned to capitalize on these favorable growth dynamics.
About the Industry
The Zacks HMO industry consists of entities (either private or public) that take care of subscribers’ basic and supplemental health services. Players in this space primarily assume risks and assign health and medical insurance policy premiums. Industry participants also provide administrative and managed-care services for self-funded insurance.
Services are generally offered via a network of approved care providers (called in-network), which include primary care physicians, clinical facilities, hospitals and specialists. However, out-of-network exceptions are made during emergencies or when medically necessary. Health insurance plans can be availed through private purchases, social insurance or social welfare programs.
4 Trends Shaping the Future of the HMO Industry
Diversified Offerings Support Enrolment Stability: Health insurers continue to strengthen their membership base by offering diversified, cost-effective plans with enhanced benefits. These offerings support steady enrollment growth, generate consistent premium income and often lead to contract wins and renewals from federal and state agencies. However, gains from diversified products are expected to only partly offset the expected Medicaid membership declines resulting from growing regulatory challenges following the enactment of the One Big Beautiful Bill Act.
The legislation introduced stricter Medicaid eligibility checks, work requirements and reduced federal funding. These measures, coupled with the absence of ACA subsidy extensions, are likely to reduce enrollment and pressure margins, prompting insurers to focus more on higher-margin commercial plans, while anticipated Medicare Advantage reimbursement rate increases in 2026 may provide some support.
An Aging U.S. Population: Medicare plans are specifically designed to meet the healthcare needs of individuals aged 65 and older, and an aging U.S. population is expected to drive sustained demand for these products. As the baby boomer generation enters retirement and life expectancy continues to increase, health insurers are well-positioned to benefit and generate higher premium revenues.
To effectively serve this demographic, insurers maintain broad networks of healthcare providers, including physicians, hospitals, pharmacies and ancillary care organizations, while some also operate dedicated senior-focused care centers that deliver personalized, high-quality services tailored to the unique medical and wellness needs of older adults.
Digital Transformation and Technological Innovation: The HMO industry continues to strengthen its investment in virtual healthcare solutions, or telehealth services, as digital transformation reshapes the healthcare landscape. Technologies such as Artificial Intelligence (AI)-powered chatbots, voice assistants, mobile health applications, robotics, cloud computing and advanced data analytics are revolutionizing the way healthcare services are delivered, allowing patients to receive timely care from the comfort of their homes.
This shift not only eases the strain on the U.S. healthcare system by reducing hospital visits and admissions but also enhances patient experience and care accessibility. While the adoption of advanced technologies may initially increase costs for health insurers, the resulting gains are expected to support stronger and more sustainable revenue growth over the long term.
Strategic Expansion Via Mergers and Acquisitions: In addition to embracing technological advancements, HMOs frequently engage in M&A to expand their capabilities, penetrate new markets, strengthen their foothold in existing regions, grow their membership base and enhance their nationwide reach. These strategic transactions also promote business diversification, enabling companies to maintain a competitive edge within the industry. Following the Federal Reserve's three interest rate cuts in 2025, borrowing conditions have become more favorable. Lower financing costs are expected to encourage greater M&A activity.
Zacks Industry Rank Instills Optimism
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates bright near-term prospects. The Zacks Medical-HMOs industry, which is housed within the broader Zacks Medical sector, currently carries a Zacks Industry Rank #27, which places it in the top 11% of 246 Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
The industry’s positioning in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate.
Before we present a few stocks that you may want to buy or retain in your portfolio, let’s look at the industry’s recent stock-market performance and valuation picture.
Industry Underperforms S&P 500, Outperforms Sector
The Zacks Medical-HMO industry has gained 17.3% in the past year compared with the Zacks S&P 500 composite’s 31.3% growth. The Zacks Medical sector rallied 2.8% in the same time frame.
Industry's Current Valuation
Based on the forward 12-month price-to-earnings (P/E) ratio, which is commonly used for valuing medical stocks, the industry trades at 16.66X compared with the S&P 500’s 22.17X and the sector’s 19.33X.
Over the past five years, the industry has traded as high as 19.57X and as low as 11.58X, with the median being at 16.14X.
5 Stocks to Keep a Close Eye On
We present five stocks from the space, either carrying a Zacks Rank #2 (Buy) or #3 (Hold). Considering the current industry scenario, it might be prudent for investors to buy or retain these stocks in their portfolio, as these are well-placed to generate growth in the long haul.
Centene: Based in Missouri, Centene continues to benefit from strong momentum in its Medicare and Medicaid businesses, supported by numerous contract awards and steady membership expansion. The growing aging population in the United States remains a key driver of demand for Medicare Advantage plans, reinforcing the strength of Centene’s Medicare segment. This Zacks Rank #1 company also pursues strategic growth through acquisitions and provider partnerships. Management projects premium and service revenues within $171-$175 billion for 2026.
The Zacks Consensus Estimate for Centene’s 2026 earnings is pegged at $3.47 per share, which indicates a 66.8% rise from the year-ago figure. CNC’s earnings outpaced estimates in three of the last four quarters and missed the mark once, the average being 74.90%.
Molina Healthcare: This California-based health insurer develops affordable Medicare and Medicaid plans, enriched with extensive benefits, which have consistently led to contract wins. These contracts have contributed to a steadily growing customer base for the Zacks Rank #2 company. Management expects the 2026 premium revenue outlook to be approximately $42 billion. The company continues to strengthen its market position through acquisitions, including ConnectiCare in 2025.
The Zacks Consensus Estimate for Molina Healthcare’s 2026 earnings is pegged at $5.23 per share. The consensus mark for MOH’s 2026 earnings has moved 0.4% north over the past 30 days. MOH’s earnings beat estimates in one of the last four quarters and missed the mark thrice.
UnitedHealth Group: Minnesota-based UnitedHealth Group continues to deliver solid revenue growth, driven by the strong performance of its UnitedHealthcare and Optum segments. UnitedHealthcare benefits from enhanced Medicare and Medicaid offerings that combine affordability with attractive benefits. Optum remains a key growth engine, leveraging strategic acquisitions, advanced technology and data-driven healthcare solutions to enhance care delivery and operational efficiency. Additionally, continued focus on mergers and acquisitions, coupled with expanding telehealth capabilities, strengthens the nationwide footprint of this Zacks Rank #3 company.
The Zacks Consensus Estimate for UnitedHealth Group’s 2026 earnings is pegged at $18.29 per share, which implies 11.9% growth from the year-ago figure. UNH’s earnings beat estimates in three of the last four quarters and missed the mark once, the average surprise being 0.84%.
Cigna: Based in Connecticut, the company continues to demonstrate strong growth, supported by the robust performance of its two key business segments—Evernorth and Cigna Healthcare. Evernorth benefits from its comprehensive portfolio of specialty pharmacy services, while Cigna Healthcare leverages its broad customer base across both the U.S. Government and U.S. Commercial markets. This Zacks Rank #3 company further enhances its market position and growth prospects through strategic acquisitions and partnerships with leading healthcare organizations, while continuously expanding its product offerings.
The Zacks Consensus Estimate for Cigna’s 2026 earnings is pegged at $30.38 per share, indicating 1.8% growth from the prior-year figure. CI’s earnings beat estimates in each of the last four quarters, the average surprise being 1.86%.
Humana: Headquartered in Kentucky, Humana has delivered steady growth, driven by increasing premium income and a strong membership base across its Medicare and Medicaid segments. The strong execution of these programs has enabled this Zacks Rank #3 company to win new contracts and successfully renew existing agreements with federal and state government agencies.
Through its CenterWell platform, Humana continues to focus on meeting the evolving healthcare needs of the nation’s growing senior population. Additionally, strategic acquisitions such as Family Physicians Group, iCare and Inclusa have strengthened the company’s business diversification efforts and expanded its geographic reach.
The Zacks Consensus Estimate for Humana’s 2026 earnings is pegged at $9.01 per share. The consensus mark for 2025 revenues implies 25.3% growth from the year-ago actual. HUM’s earnings surpassed estimates in three of the last four quarters and missed the mark once, the average surprise being 3.80%.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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