ELV
HealthcareElevance Health
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XBRL · SEC EDGAR2007–2025(19yr)| Metric | FY 2007 | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $61.2B | $61.3B | $65.0B | $58.8B | $60.7B | $61.7B | $71.0B | $73.9B | $79.2B | $84.9B | $90.0B | $92.1B | $104.2B | $121.9B | $138.6B | $156.6B | $171.3B | $177.0B | $199.1B | +12.5% |
| Gross Profit | $60.7B | $60.8B | $64.6B | $58.8B | $60.7B | $61.6B | — | — | — | — | $90.0B | $92.1B | $102.2B | $112.9B | $127.7B | $143.6B | $154.0B | $157.3B | $177.9B | +13.2% |
| Gross Margin | 99.3% | 99.2% | 99.4% | 100.0% | 100.0% | 99.8% | — | — | — | — | 100.0% | 100.0% | 98.1% | 92.7% | 92.1% | 91.7% | 89.9% | 88.8% | 89.4% | +0.5pp |
| Operating Income | — | $4.3B | $4.2B | $4.1B | $3.8B | $3.6B | $4.0B | $4.4B | $4.8B | $4.8B | $4.2B | $5.4B | $6.0B | $6.4B | $7.5B | $8.5B | $8.5B | $7.9B | $7.2B | -8.4% |
| Operating Margin | — | 7.1% | 6.4% | 6.9% | 6.2% | 5.9% | 5.6% | 6.0% | 6.0% | 5.7% | 4.6% | 5.9% | 5.8% | 5.2% | 5.4% | 5.4% | 5.0% | 4.4% | 3.6% | -0.8pp |
| Net Income | $3.3B | $2.5B | $4.7B | $2.9B | $2.6B | $2.7B | $2.5B | $2.6B | $2.6B | $2.5B | $3.8B | $3.8B | $4.8B | $4.6B | $6.1B | $6.0B | $6.0B | $6.0B | $5.7B | -5.3% |
| Net Margin | 5.5% | 4.1% | 7.3% | 4.9% | 4.4% | 4.3% | 3.5% | 3.5% | 3.2% | 2.9% | 4.3% | 4.1% | 4.6% | 3.8% | 4.4% | 3.8% | 3.5% | 3.4% | 2.8% | -0.5pp |
| Free Cash Flow | $4.0B | $2.2B | $2.7B | $965.3M | $2.9B | $2.2B | $2.4B | $2.7B | $3.5B | $2.6B | $3.4B | $2.6B | $5.0B | $9.7B | $7.3B | $7.2B | $6.8B | $4.6B | $3.2B | -30.3% |
| FCF Margin | 6.6% | 3.6% | 4.1% | 1.6% | 4.7% | 3.6% | 3.4% | 3.6% | 4.4% | 3.1% | 3.8% | 2.8% | 4.8% | 7.9% | 5.2% | 4.6% | 3.9% | 2.6% | 1.6% | -1.0pp |
| EPS (Diluted) | $5.56 | $4.76 | $9.88 | $6.94 | $7.25 | $8.18 | $8.20 | $8.99 | $9.38 | $9.21 | $14.35 | $14.19 | $18.47 | $17.98 | $24.73 | $24.81 | $25.22 | $25.68 | $25.21 | -1.8% |
1. THE BIG PICTURE
Elevance Health is aggressively pivoting from a traditional health insurer into a "whole-health" services provider, using its Carelon division to capture more spend across the patient journey. While this strategy has pushed revenue growth to the top of its peer group, Elevance Health is currently navigating a "dynamic environment" where rising healthcare costs have temporarily pushed its core insurance business into the red.
2. WHERE THE RISKS HIT HARDEST
Elevance Health’s primary competitive advantage—its exclusive right to the Blue Cross and Blue Shield brand—is also a multi-billion dollar vulnerability. While management cites this brand as providing "significant market value" when competing for large employers (10-K Item 1), the "BCBSA License Termination" risk carries a literal price tag: a $3 billion "Re-establishment Fee" based on current enrollment levels.
Furthermore, Elevance Health’s "Scale and Local Presence" is threatened by "Enrollment Volatility," particularly regarding Medicaid redeterminations. Because Elevance Health relies on proprietary data for pricing, any significant reduction in membership across its 45.2 million medical members compromises the data-driven insights used to inform underwriting and care management (10-K Item 1).
3. WHAT THE NUMBERS SAY TOGETHER
(XBRL) The financial data reveals a company growing much faster than its profitability suggests. Elevance Health leads its peer group with 12.5% revenue growth, yet its 3.2% net margin trails UnitedHealth (4.2%). This gap is explained by a stark divergence in the most recent quarter: while total revenue rose 10% to $49.3 billion, the Health Benefits segment reported an adjusted operating loss of $0.2 billion (8-K).
This suggests that while the "Carelon" services business is scaling rapidly—with revenue up 27%—it is not yet providing enough of a profit cushion to offset the "Healthcare Cost Management" risks in the insurance arm. The 12.5% TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue growth is slightly higher than the 10% growth seen in the most recent quarter, indicating a minor deceleration as Elevance Health prioritizes "pricing discipline" for 2026. With short interest at a low 2.1% of the float, market sentiment remains stable despite the recent quarterly operating loss in the benefits segment.
4. IS IT WORTH IT AT THIS PRICE?
(CAPM analysis) At a forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations of 9.6x, Elevance Health trades at a 32% discount to the peer median of 14.2x. This valuation is attractively low given that Elevance Health leads its peers in revenue growth (+12.5%) and maintains the highest gross margins in the group at 89.3% (XBRL).
The market is currently pricing in a long-term growth rate of just 0.5%. This appears overly cautious when compared to management’s stated confidence in returning to "at least 12% adjusted EPSEPSEarnings Per Share — the company's net profit divided by its share count; the most common per-share profitability metric growth in 2027" (8-K). If Elevance Health successfully navigates the current "dynamic environment" and growth moves toward a GDP-pace of 2.5%, the justified multiple would rise to 21.9x. The primary factor keeping the price depressed is likely the "Government Program Participation" risk; any further retroactive rate adjustments or changes to the Medicare Star Rating System could impair the earnings power the market is currently discounting.
5. WHAT WOULD CHANGE THIS VIEW?
- Cautious if the Health Benefits segment reports a second consecutive quarter of adjusted operating losses, suggesting that medical cost inflation is outstripping Elevance Health's pricing adjustments.
- Constructive if Carelon’s adjusted operating gains begin to grow in tandem with its 27% revenue growth, proving that the services business can scale its margins.
- Cautious if total medical enrollment drops below 45 million, indicating that Medicaid redeterminations or commercial competition are eroding Elevance Health's scale advantage.
6. BOTTOM LINE
Structural Advantage: Exclusive access to the Blue Cross Blue Shield brand in key markets combined with a rapidly scaling, high-growth services ecosystem in Carelon. Bottom Line: Elevance Health is a top-tier grower trading at a deep discount, making it a compelling value if it can stabilize its core insurance margins.
1. Top 5 Material Risks
- Healthcare Cost Management: Elevance Health’s profitability depends on its ability to predict and price for healthcare costs, which are subject to extensive judgment and inherent variability. Costs in excess of projections cannot be recovered within the contract year for commercial policies and Medicare/Medicaid bids.
- Enrollment Volatility: A significant reduction in enrollment—driven by factors such as workforce reductions, Medicaid eligibility redeterminations, or loss of customers—directly threatens cash flows and financial condition.
- BCBSA License Termination: Elevance Health relies on license agreements with the BCBSA to use its names and marks. Termination of these agreements would result in a "Re-establishment Fee" of $98.33 per licensed enrollee, which would total approximately $3 billion based on the 34 million enrollees as of December 31, 2025.
- Cybersecurity and Data Privacy: Elevance Health collects and processes sensitive personal information. A cyber-attack or data breach could result in remediation expenses, liability, litigation, and regulatory fines, while also disrupting operations and damaging Elevance Health's reputation.
- Government Program Participation: Elevance Health is subject to risks associated with Medicare and Medicaid, including retroactive rate adjustments, CMS changes to risk adjustment models (such as the hierarchical condition category model), and the Star Rating System, which impacts quality-based bonus payments.
2. Company-Specific Risks
- CVS Pharmacy Agreement: Elevance Health delegates significant pharmacy benefit manager services to CVS. If CVS fails to perform as required, Elevance Health may be unable to meet customer demands, potentially harming its reputation and results of operations.
- Geographic Concentration: A significant portion of revenue is concentrated in California, New York, Virginia, Indiana, Ohio, Georgia, Florida, and Texas, exposing Elevance Health to state-specific economic downturns or healthcare coverage changes.
- Goodwill and Intangible Assets: As of December 31, 2025, Elevance Health held approximately $39.5 billion in goodwill and other intangible assets, representing 32.5% of total consolidated assets. Impairment of these assets would negatively impact future income and shareholders’ equity.
- AI Implementation: Elevance Health is investing in AI tools to enhance operations. Inadequacies in AI design, development, or compliance with emerging regulations could lead to harmful bias, discrimination, or cybersecurity risks that adversely affect financial results.
3. Regulatory/Legal Risks
- Pharmacy Benefit Manager (PBM) Reform: The Consolidated Appropriations Act of 2026 requires PBMs to remit all rebates and fees (excluding bona fide service fees) to commercial plan sponsors and prohibits PBMs from receiving remuneration related to Part D drugs other than bona fide service fees effective in 2028.
- Medicare Advantage Audits: Elevance Health is subject to CMS Risk Adjustment Data Validation (RADV) audits and Medicare Part D Recovery Audit Contractor (RAC) audits, which can result in significant adjustments to payments and future bids.
- Minimum Medical Loss Ratio (MLR) Rules: Failure to meet minimum MLR thresholds can lead to rebate requirements, ineligibility to enroll new members (after three consecutive years of rebates), or contract termination by CMS (after five consecutive years).
- Practice of Medicine Restrictions: Many states limit the practice of medicine to licensed individuals or professional organizations. Enforcement actions alleging non-compliance with fee-splitting or corporate control rules could adversely affect operations.
4. Financial Impact Map
Healthcare Cost Prediction → Results of Operations → Inability to recover costs in excess of projections within the contract year. Enrollment Reduction → Cash Flows and Financial Condition → Loss of premium revenue and pharmacy services volume. BCBSA License Termination → Cash Flows and Financial Condition → Potential $3 billion "Re-establishment Fee" assessment. Cybersecurity Incident → Operating Expenses → Costs for remediation, litigation, and regulatory fines. Goodwill Impairment → Shareholders’ Equity → Potential impairment charges against future income if fair value falls below carrying value of $39.5 billion.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 10-K | Feb 2026 | Dec 2025 |
| 8-K | Jan 2026 | — |
| 10-Q | Oct 2025 | Sep 2025 |
| 14A | Mar 2025 | — |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
Elevance Health Q4 Revenue $49.31B Misses Estimates, Shares Down 11.5% Post-Earnings
- ▸Q4 revenue $49.31B, +9.6% YoY, missed estimates by 1.2%
- ▸Missed full-year EPS guidance estimates significantly
- ▸Targeting 12% adjusted EPS growth in 2027
- ▸Health insurance sector average share price down 16.3% post-earnings
- ▸Clover Health Q4 revenue $487.7M, +44.7% YoY, beat estimates by 4.4%
Elevance Health Q4 Revenue $49.3B +10% YoY, Full-Year Adjusted EPS $30.29 Declines 8.3%
- ▸Q4 consolidated operating revenue $49.3B, up 10% YoY
- ▸Full-year 2025 adjusted EPS $30.29, down 8.3% YoY
- ▸Benefit expense ratio increased to 90% for full year
- ▸Health Benefits segment revenue $167.1B, operating gain dropped 34%
- ▸Carelon segment revenue grew 33% driven by risk-based solutions and acquisitions
Elevance Health targets 2026 adjusted EPS of at least $25.50
- ▸Targeting 2026 adjusted EPS of at least $25.50
- ▸Baupost Group holds 1.2 million shares as fourth-largest position
- ▸Baupost Group trimmed stake by 4% in Q4 2025
- ▸Company focuses on margin recovery and portfolio repositioning
- ▸Baupost initial position established in early 2025
Elevance Health expands coverage for Myomo orthotic devices across commercial and government plans
- ▸Elevance Health adds Myomo orthotic devices to in-network coverage
- ▸Coverage applies to commercial, Medicare Advantage, and Medicaid plans
- ▸Agreement impacts access for over 45 million Elevance members
- ▸Partnership supports Elevance's strategy for tech-enabled, patient-centered care
- ▸Move aligns with Carelon services and broader care coordination initiatives