Evolent Health (EVH.N): 2Q26 Recap: A Solid Quarter with More FY27 Visibility

Research evidence excerpt

Vi ewp oint |

06 Aug 2026 14:24:54 ET │ 16 pages

Evolent Health (EVH.N)

2Q26 Recap: A Solid Quarter with More FY27 Visibility

CITI'S TAKE

EVH reported a solid 2Q with revenue +46.8% y/y (beating our/cons.

estimates by 3%/9%), driven by 81% PS growth reflecting the May 1

Highmark launch and continued Aetna ramp, partially offset by T&S

softness (-3.9% y/y). Adj. EBITDA of $28.1M beat our/cons. expectations by

18%/23%, though the beat was largely a PYD timing pull-forward from 3Q,

compressing the 3Q step-up to $4M–$7M. MER of 95.3% (vs. 93% in Q1)

reflected Highmark launch dynamics, but mgmt. guided to ~250bps

improvement by 4Q as Aetna/Highmark contracts mature and contractual

true-ups flow through ($7M–$15M 4Q adj. EBITDA step-up). For 2027,

mgmt. committed to adj. EBITDA at or above $150M on >25% revenue

growth, underpinned by PS care margin improvement and Auth Intelligence

deployment, despite Medicaid/exchange headwinds. EVH raised FY26

guidance (Revenue: $2.6B–$2.7B; Adj. EBITDA: $120M–$135M), supported

by two new wins including a $300M annualized oncology PS partnership.

Results — Revenue grew +46.9% y/y, beating our/cons. estimates of

$632.8M/$596.7M. Growth was driven by the Performance Suite (PS) (+80.8% y/y),

which beat our/cons. estimates by 5.1%/15.2%. This was partially offset by weakerthan-anticipated T&S revenue which missed our/cons. by 3.4%/6.5%, driven by

code review scope changes related to PA standards (not client attrition or pricing

pressure). Case revenue beat our/cons. estimates as EVH saw strength in both cases

and rev per case. Admin revenue declined 14.3% y/y, missing our/cons. by

3.4%/6.2%. EVH reported adj. EBITDA of $28.1M, beating our/cons. by

17.8%/22.8%, driven by opex discipline + PYD, partially offset by MER of 95.3%.

n

Neutral / High Risk

Price (05 Aug 26 16:00)

US$3.08

Target price

US$6.75

Expected share price return 119.2%

Expected dividend yield

0.0%

Expected total return

119.2%

Market Cap

US$346M

Price Performance

(RIC: EVH.N, BB: EVH US)

Guidance — EVH raised Rev/Adj. EBITDA guidance by $150M/$2.5M, reflecting 2Q

performance and new signings/renewals. Due to some pull forward in 2Q, EVH

expects a $4-7M step up in 3Q adj.…