Summary
Elevance Health, Inc. (formerly Anthem, Inc.) reported strong financial performance for the first quarter of 2017, with operating revenue increasing by 9.9% year-over-year to $22.3 billion and net income rising by 43.7% to $1.01 billion. This growth was driven by higher premium revenues across its commercial and government segments, reflecting rate increases and membership expansion, particularly in Medicaid and Local Group offerings. The company also benefited from a suspension of the Health Insurance Provider (HIP) Fee for 2017, which reduced expenses and income tax obligations. Despite robust revenue and net income growth, investors should note the ongoing significant legal and regulatory challenges. The company is heavily involved in litigation concerning its proposed acquisition of Cigna Corporation, with a pending appellate decision after a district court ruled against the merger. Additionally, Anthem is facing other substantial legal actions, including a major antitrust lawsuit involving Blue Cross Blue Shield licensees and a significant lawsuit against its pharmacy benefit manager, Express Scripts, over pricing disputes. While the company reported increased operating cash flow and a solid liquidity position, these ongoing legal matters and the inherent complexities of the healthcare industry present notable risks to future performance.
Financial Highlights
51 data points| Revenue | $22.52B |
| SG&A Expenses | $3.19B |
| Operating Income | $1.59B |
| Interest Expense | $235.00M |
| Net Income | $1.01B |
| EPS (Basic) | $3.82 |
| EPS (Diluted) | $3.73 |
| Shares Outstanding (Basic) | 264.40M |
| Shares Outstanding (Diluted) | 270.40M |
Key Highlights
- 1Operating revenue increased by 9.9% to $22.3 billion for the three months ended March 31, 2017, compared to the prior year period, driven by higher premium revenue and administrative fees.
- 2Net income saw a substantial increase of 43.7% to $1.01 billion, or $3.73 per diluted share, compared to the first quarter of 2016.
- 3Medical membership grew by 2.6% to 40.6 million members, primarily due to increases in Medicaid and Local Group membership.
- 4The company's operating cash flow more than doubled, increasing by $1.3 billion to $2.69 billion for the first quarter of 2017.
- 5The Health Insurance Provider (HIP) Fee was suspended for 2017, contributing to lower benefit expenses and income tax expense.
- 6The company's pending acquisition of Cigna Corporation faces significant legal and regulatory challenges, with an appellate court decision still pending after a district court ruling against the merger.
- 7Elevance Health is actively involved in multiple significant legal proceedings, including a major antitrust lawsuit and a dispute with its pharmacy benefit manager, Express Scripts.