Medibank Private Limited (MPL.AX): Tweaking estimates mostly on mark to market, looks fairly priced

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Medibank Private Limited (MPL.AX): Tweaking estimates mostly on mark to market, looks fairly priced

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07 Jul 2026 05:51:22 ET │ 16 pages

Medibank Private Limited (MPL.AX)

Tweaking estimates mostly on mark to market, looks fairly priced

CITI'S TAKE

Given MPL’s 5.1% April premium increase and with industry participation

still at high levels, we expect MPL to deliver a solid FY26 result, albeit with

fewer obvious sources of upside than in recent periods. Resident Neutral

policyholder growth has improved, particularly in the Medibank brand, but Price (07 Jul 26 16:00) A$5.00

still looks likely to finish below system, while claims inflation appears

Target price A$5.10manageable rather than benign. Non-residents and Medibank Health

should continue to support earnings growth, although neither seems likely Expected share price return 2.0%

to materially change the near-term group earnings trajectory. On mark to Expected dividend yield 3.9%

market and other changes, we make only minor changes to forecasts,

Expected total return 5.9%leaving our broader investment thesis unchanged. We remain Neutral with

a A$5.10 target price. Market Cap A$13,770M

US$9,657M

Residents’ policyholder growth likely below system for FY26 — MPL grew its

residents by 1.1% in the nine months to Mar-26, which is lower than industry growth

of 1.8% over the same period. More positively, 42% of this growth was from its

Medibank brand with ahm aggregator exposure being intentionally reduced. Price Performance

No reason to doubt MPL’s claims inflation guidance — Medibank guides to claims (RIC: MPL.AX, BB: MPL AU)

growth per policy unit of 2.6%-2.9% for FY26 (1H26: 2.5%) and it will be interesting

to observe where in the range this lands (Citi est 2.71%). At its May update, MPL