Centene (CNC) 2Q26: Faster recovery of ACA risk adjustment key insight from qtr; increasing PT to $79

研报英文原文证据摘录

Centene (CNC) 2Q26: Faster recovery of ACA risk adjustment key insight from qtr; increasing PT to $79

- Total revenue ($53.6B) beat consensus by 13.2%, driven by PDP premium yield and membership

growth, Medicaid and Marketplace rate increases, Marketplace risk adj, and Medicaid state directed payments (DPP). The strong

revenue was partially offset by lower Medicaid and Marketplace membership. CNC noted that the 2Q26 MLR (~340 bps lower

YoY) was driven by improved pricing and acuity among Marketplace members, rate increases in Medicaid, and an increase to the

premium deficiency reserve (PDR) in 2025 (vs. no PDR in 2026) for MA.

Change to Board of Directors - CNC also announced this morning that Paul J. Diaz has been appointed to its Board of

Directors to replace Kenneth A. Burdick, who has retired from the BOD effective today. Burdick leaves after decades of

leadership experience in healthcare, formerly as EVP of Products and Markets at CNC and CEO of WellCare Health Plans. Diaz

comes in as a Managing Partner at Cressey & Company, and has previously served as CEO of Myriad Genetics and CEO of

Kindred Healthcare.

COMMENTS FROM MANAGEMENT

Medicaid

Membership: In 2Q26, CNC ended with ~12.1M Medicaid members, a slightly larger step-down than expected, driven by state

specific changes and early enrollment/eligibility tightening ahead of OBBB. Management is now guiding FY26 membership to

decline 8% to 9% (vs prior 6% guide). Management noted the attrition skews toward low/zero utilizers rolling off first, which is

driving the accompanying acuity uptick. They added that this is most pronounced in the expansion population, which is expected

to fall from 20% of their total Medicaid population (at start of year) to ~18% by year-end. The company said it absorbed the