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1. Company Snapshot

1.a. Company Description

Alignment Healthcare, Inc., a tech-enabled Medicare advantage company, operates consumer-centric health care platform.It provides customized health care in the United States to seniors and those who need it through its Medicare advantage plans.The company owns Medicare advantage plans in the states of California, North Carolina, and Nevada.


It also coordinates and provides covered health care services, including professional, institutional, and ancillary services to members enrolled in certain benefit plans of unaffiliated Medicare Advantage Health Maintenance Organizations.The company was founded in 2013 and is based in Orange, California.

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1.b. Last Insights on ALHC

Alignment Healthcare's recent performance was driven by its strong Q3 2025 earnings, which included a quarterly earnings beat of $0.02 per share, surpassing the Zacks Consensus Estimate of a loss of $0.07 per share. The company's momentum was further bolstered by an analyst upgrade from JPMorgan Chase and Co., which raised its rating from neutral to overweight with a $20.00 price target. Additionally, Alignment Healthcare's presentation at the Piper Sandler 37th Annual Healthcare Conference and its year-to-date gain of over 55% have positioned the company near two buy points.

1.c. Company Highlights

2. Alignment Healthcare's Strong Q3 2025 Earnings: A Closer Look

Alignment Healthcare reported a robust third quarter, with revenues reaching $994 million, a 44% year-over-year increase, driven by a 26% growth in health plan membership to 229,600. The company's adjusted gross profit stood at $127 million, a 58% increase from the prior year, resulting in a consolidated Medical Benefit Ratio (MBR) of 87.2%, an improvement of 120 basis points over the prior year. The adjusted SG&A ratio improved by 120 basis points year-over-year to 9.6%. The company's actual EPS came out at $0.02, beating estimates of -$0.01.

Publication Date: Nov -16

📋 Highlights
  • Health Plan Membership Growth:: 229,600 members, 26% YoY increase, driving 44% YoY revenue growth to $994 million.
  • Adjusted Gross Profit Surge:: $127 million, 58% YoY increase, with MBR improvement to 87.2% (+120 bps YoY).
  • EBITDA Outperformance:: $32 million adjusted EBITDA, surpassing guidance, with 3Q25 marking the third consecutive quarter exceeding guidance.
  • Stars Rating Excellence:: 100% of members in 4+ star plans (2026 rating year), vs. 63% national average.
  • SG&A Efficiency:: 9.6% adjusted SG&A ratio, down 120 bps YoY, reflecting scalable operations and cost discipline.

Operational Highlights

The company's operational performance was equally impressive, with 100% of its health plan members in plans rated 4 stars or above for rating year 2026, payment year 2027, surpassing the national average of approximately 63%. The company's Stars results demonstrate the consistency and replicability of its high-quality outcomes across each of its markets. As John Kao mentioned, "We're once again demonstrating the consistency and replicability of our high-quality outcomes across each of our markets."

Growth Prospects and Guidance

Alignment Healthcare has raised its full-year EBITDA guidance to $94 million at the midpoint, compared to its initial guidance of $47.5 million. The company's guidance assumes a portion of the strong year-to-date performance persists through the fourth quarter. Analysts estimate next year's revenue growth at 27.8%, indicating a strong outlook for the company.

Valuation Metrics

Looking at the company's valuation metrics, the current P/S Ratio stands at 0.91, while the EV/EBITDA ratio is at 104.01. These metrics suggest that the market is pricing in a significant premium for the company's growth prospects. The company's ROE is currently at -16.29%, and the ROIC is at 0.6%, indicating that the company is still in a growth phase and investing heavily in its business.

Investment Implications

The company's strong operational performance, coupled with its growth prospects, makes it an attractive investment opportunity. However, investors should be cautious about the company's valuation, given its high EV/EBITDA ratio. As the company continues to expand into new markets and replicate its care model, it is likely to remain a key player in the Medicare Advantage space.

3. NewsRoom

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Health Care Leader Nears Two Buy Points Following 55% Leap This Year

Nov -25

Source:

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Alignment Healthcare (NASDAQ:ALHC) Stock Price Up 8.5% After Analyst Upgrade

Nov -25

Source: defenseworld.net

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Alignment Healthcare to Present at Piper Sandler 37th Annual Healthcare Conference

Nov -19

Source: globenewswire.com

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Acadian Asset Management LLC Decreases Stock Holdings in Alignment Healthcare, Inc. $ALHC

Nov -14

Source: defenseworld.net

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Alignment Healthcare, Inc. (ALHC) Q3 2025 Earnings Call Transcript

Oct -31

Source: seekingalpha.com

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Alignment Healthcare (ALHC) Q3 Earnings: How Key Metrics Compare to Wall Street Estimates

Oct -30

Source: zacks.com

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Alignment Healthcare (ALHC) Q3 Earnings and Revenues Beat Estimates

Oct -30

Source: zacks.com

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Alignment Healthcare Reports Second Profitable Quarter By Taming Costs

Oct -30

Source: forbes.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.57%)

6. Segments

Premium

Expected Growth: 8.4%

Alignment Healthcare, Inc.'s 8.4% premium growth is driven by increasing demand for value-based care, expansion into new markets, and strategic partnerships. Additionally, the company's focus on Medicare Advantage and Medicaid populations, as well as its technology-enabled care model, contribute to its growth momentum.

Capitation

Expected Growth: 10.47%

Alignment Healthcare's capitation growth of 10.47% is driven by increasing adoption of value-based care models, expansion into new markets, and strategic partnerships with healthcare providers. Additionally, the company's data-driven approach to population health management and care coordination is attracting more patients and driving revenue growth.

Other

Expected Growth: 9.9%

Alignment Healthcare's 9.9% growth is driven by increasing demand for value-based care, expansion into new markets, and strategic partnerships. The company's Medicare Advantage and Medicaid offerings are experiencing high growth, fueled by the aging population and government initiatives. Additionally, its care coordination and population health management services are in high demand, contributing to the company's rapid expansion.

7. Detailed Products

AVM (Alignment Virtual Medicare)

A Medicare Advantage plan designed to provide high-quality, patient-centered care to Medicare-eligible individuals.

CMS (Care Management Services)

A comprehensive care management program that coordinates medical, social, and behavioral health services for high-risk patients.

Population Health Management

A data-driven approach to managing patient populations, identifying high-risk individuals, and providing targeted interventions to improve health outcomes.

Care Coordination

A patient-centered approach to coordinating medical, social, and behavioral health services to improve health outcomes and reduce costs.

Data Analytics and Insights

A data-driven platform providing actionable insights to improve healthcare operations, quality, and cost.

8. Alignment Healthcare, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Alignment Healthcare, Inc. is medium due to the presence of alternative healthcare providers and services. However, the company's focus on value-based care and population health management may reduce the threat of substitutes.

Bargaining Power Of Customers

The bargaining power of customers for Alignment Healthcare, Inc. is low due to the company's strong relationships with patients and providers. The company's patient-centric approach and focus on improving health outcomes may reduce the bargaining power of customers.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Alignment Healthcare, Inc. is medium due to the company's dependence on healthcare providers and suppliers. However, the company's scale and negotiating power may reduce the bargaining power of suppliers.

Threat Of New Entrants

The threat of new entrants for Alignment Healthcare, Inc. is low due to the high barriers to entry in the healthcare industry. The company's established relationships with providers and patients, as well as its focus on value-based care, may reduce the threat of new entrants.

Intensity Of Rivalry

The intensity of rivalry for Alignment Healthcare, Inc. is high due to the competitive nature of the healthcare industry. The company faces competition from other healthcare providers and payers, and must differentiate itself through its focus on value-based care and population health management.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 52.36%
Debt Cost 10.11%
Equity Weight 47.64%
Equity Cost 10.11%
WACC 10.11%
Leverage 109.91%

11. Quality Control: Alignment Healthcare, Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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UroGen Pharma

A-Score: 4.9/10

Value: 8.2

Growth: 5.6

Quality: 6.1

Yield: 0.0

Momentum: 9.0

Volatility: 0.7

1-Year Total Return ->

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Marpai

A-Score: 4.7/10

Value: 9.4

Growth: 3.9

Quality: 5.4

Yield: 0.0

Momentum: 9.0

Volatility: 0.7

1-Year Total Return ->

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Armata Pharmaceuticals

A-Score: 4.4/10

Value: 8.0

Growth: 4.6

Quality: 6.1

Yield: 0.0

Momentum: 8.0

Volatility: 0.0

1-Year Total Return ->

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Alignment Healthcare

A-Score: 4.4/10

Value: 3.4

Growth: 6.8

Quality: 3.3

Yield: 0.0

Momentum: 9.0

Volatility: 3.7

1-Year Total Return ->

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Stock-Card
Castle Biosciences

A-Score: 3.5/10

Value: 4.8

Growth: 8.2

Quality: 5.2

Yield: 0.0

Momentum: 1.0

Volatility: 2.0

1-Year Total Return ->

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Sensus Healthcare

A-Score: 3.4/10

Value: 7.5

Growth: 6.6

Quality: 4.2

Yield: 0.0

Momentum: 0.5

Volatility: 1.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

19.55$

Current Price

19.55$

Potential

-0.00%

Expected Cash-Flows