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1. Company Snapshot

1.a. Company Description

Elevance Health Inc.operates as a health benefits company.It supports consumers, families, and communities across the entire care journey connecting to the care, support, and resources to lead healthier lives.


It serves approximately 118 million people through a portfolio of medical, digital, pharmacy, behavioral, clinical, and care solutions.The company was formerly known as Anthem, Inc.and changed its name to Elevance Health Inc.


in June 2022.Elevance Health Inc.was founded in 1944 and is headquartered in Indianapolis, Indiana.

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1.b. Last Insights on ELV

Elevance Health's recent performance was driven by strong Q3 earnings, beating estimates with $6.03 per share, and robust revenue growth. The company's value-based care strategy, Carelon integration, and CareBridge acquisition fueled membership and revenue growth. Despite a lawsuit update and concerns over medical cost ratios, the company's reaffirmation of its 12% long-term EPS growth goal and undervaluation at a forward P/E of 11.5 present opportunities. Additionally, Davenport & Co LLC's recent $110.02 million investment in ELV shares signals confidence.

1.c. Company Highlights

2. Elevance Health's Q3 Earnings Beat Expectations, Driven by Strong Revenue Growth

Elevance Health reported third-quarter GAAP diluted earnings per share of $5.32 and adjusted diluted earnings per share of $6.03, beating analyst estimates of $4.93. Total operating revenue was $50.1 billion, up 12% year-over-year, driven by higher premium yields, acquisitions, and Medicare Advantage membership growth. The consolidated benefit expense ratio was 91.3%, in line with expectations. With a P/E Ratio of 13.45 and an ROE of 12.91%, the company's valuation appears reasonable, considering its strong revenue growth and profitability.

Publication Date: Nov -25

📋 Highlights
  • GAAP & Adjusted EPS Performance:: Q3 GAAP diluted EPS was $5.32, while adjusted diluted EPS hit $6.03, reaffirming 2025 adjusted EPS guidance of ~$30 (baseline $27, excluding $3 non-recurring items).
  • Revenue Growth:: Total operating revenue surged to $50.1B, up 12% YoY, driven by higher premium yields, acquisitions, and Medicare Advantage membership expansion.
  • Medicaid Margin Challenges:: Medicaid margins are projected to decline by at least 125 bps in 2026 due to rate misalignment, elevated acuity/utilization, and state program changes, with a full-year 2025 operating margin expected to be modestly negative.
  • Carelon Strong Performance:: Carelon Rx and Services revenue grew 20% and over 50% YoY, respectively, with strategic investments in tech and integration to sustain momentum.
  • Share Repurchases & Strategic Investments:: $875M in share repurchases in Q3, plus $1 of EPS in 2026 for AI, Carelon, and operational initiatives, aiming to drive 2027 balanced earnings growth.

Segment Performance

The company's Medicaid performance was pressured by elevated acuity and utilization, with a full-year 2025 operating margin expected to be modestly negative. In contrast, Carelon, the company's care management business, delivered strong performance across pharmacy and services, with revenue growth of 20% year-over-year in Carelon Rx and over 50% in Carelon Services.

Guidance and Outlook

The company reaffirmed its 2025 adjusted EPS guidance of approximately $30, with $27 as the baseline, excluding $3 of non-recurring items. For 2026, the company's planning assumptions include a Medicaid operating margin decline of at least 125 basis points, driven by rate and trend dynamics, and investments to advance strategic goals. The company expects 2027 to mark a return to a more balanced earnings growth profile, with improved Medicaid rate alignment, Medicare margin normalization, and sustained momentum in Carelon and commercial franchise.

Investment Strategy and Capital Deployment

The company is making targeted investments in technology, integration initiatives, and operational efficiency to sustain growth and enhance performance. Elevance Health repurchased $875 million of shares in the quarter, reflecting its disciplined approach to capital deployment and commitment to returning value to shareholders. The company expects to invest several hundred million dollars, approximately $1 of EPS, in strategic goals by 2026.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at 3.6%. With a P/S Ratio of 0.38 and an EV/EBITDA of 6.54, the company's valuation appears reasonable, considering its growth prospects. The company's focus on affordability, experience, and outcomes is expected to drive sustainable growth, leveraging its whole health strategy.

3. NewsRoom

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First Look: Insurers, Auto Rules, AI and Fed Jitters

Dec -04

Source: gurufocus.com

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Elevance Health: The Potential Turnaround The Market Isn't Pricing In

Dec -02

Source: seekingalpha.com

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BLI Banque de Luxembourg Investments Invests $2.29 Million in Elevance Health, Inc. $ELV

Dec -01

Source: defenseworld.net

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Artisan Select Equity Fund Q3 2025 Portfolio Review

Nov -27

Source: seekingalpha.com

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First Eagle Global Equity ETF Q3 2025 Portfolio Update

Nov -25

Source: seekingalpha.com

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AlphaCore Capital LLC Buys 174 Shares of Elevance Health, Inc. $ELV

Nov -25

Source: defenseworld.net

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How Elevance Health is Evolving the Healthcare Consumer Experience Through Improved Personalization and Higher Touch Service

Nov -24

Source: businesswire.com

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Wall Street Breakfast Podcast: Ubisoft Cracks Next Level With Tencent

Nov -24

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.40%)

6. Segments

Health Benefits

Expected Growth: 7.5%

Elevance Health's Health Benefits segment is driven by increasing demand for medical, pharmacy, and specialty benefits among individuals and employers, as well as the company's expansion into new markets and growing adoption of value-based care models.

Corporate & Other

Expected Growth: 2.5%

Elevance Health's Corporate & Other segment growth is driven by increasing unallocated corporate expenses and expanding other business activities, which will contribute to the company's overall growth.

Carelon - Carelon Rx

Expected Growth: 10.5%

Elevance Health's pharmacy benefit management segment is driven by increasing adoption of personalized healthcare, growth in specialty pharmacy, and expansion of Medicare Advantage plans, leading to a strong growth hypothesis.

Carelon - Carelon Services

Expected Growth: 10.5%

Carelon Services, Elevance Health’s care management and coordination segment, is driven by increasing demand for value-based care, growing prevalence of chronic diseases, and the need for improved patient outcomes, leading to a strong growth hypothesis.

Unallocated Net Investment Income

Expected Growth: 7.3%

Elevance Health Inc.'s unallocated net investment income growth is driven by increasing investment yields, expansion into new markets, and effective asset liability management, leading to a forecast CAGR of 7.3%.

Unallocated Net Losses on Financial Instruments

Expected Growth: 14.5%

Elevance Health's growth is driven by its diversified business portfolio, including government-sponsored programs, commercial and specialty businesses, and care delivery capabilities, which position it for long-term growth and profitability.

Eliminations

Expected Growth: 7.4%

Elevance Health Inc. is poised for growth driven by its expanding Medicaid business, increased government funding, and a growing need for healthcare services, particularly among underserved populations.

7. Detailed Products

Anthem Medicare Advantage

Medicare Advantage plans that offer additional benefits and lower out-of-pocket costs

Anthem Medicaid

Government-sponsored health insurance for low-income individuals and families

Anthem Individual and Family Plans

Health insurance plans for individuals and families who don't have employer-sponsored coverage

Anthem Group Insurance

Employer-sponsored health insurance plans for businesses of all sizes

Elevance Health Pharmacy Benefits

Pharmacy benefits management services that help reduce prescription drug costs

Elevance Health Care Management

Care management services that help improve health outcomes and reduce costs

Elevance Health Data and Analytics

Data and analytics services that help improve health outcomes and reduce costs

8. Elevance Health Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Elevance Health Inc. is medium due to the presence of alternative healthcare services and products. However, the company's diversified portfolio and strong brand recognition mitigate this threat.

Bargaining Power Of Customers

The bargaining power of customers is low for Elevance Health Inc. due to the company's strong market position and the lack of buyer concentration in the healthcare industry.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium for Elevance Health Inc. due to the presence of multiple suppliers and the company's ability to negotiate prices. However, the company's dependence on certain suppliers for critical components may limit its bargaining power.

Threat Of New Entrants

The threat of new entrants is low for Elevance Health Inc. due to the high barriers to entry in the healthcare industry, including regulatory hurdles and the need for significant capital investments.

Intensity Of Rivalry

The intensity of rivalry is high for Elevance Health Inc. due to the presence of several established players in the healthcare industry, leading to intense competition for market share and customers.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 38.99%
Debt Cost 5.28%
Equity Weight 61.01%
Equity Cost 7.90%
WACC 6.88%
Leverage 63.91%

11. Quality Control: Elevance Health Inc. passed 4 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

Stock-Card
McKesson

A-Score: 6.2/10

Value: 5.4

Growth: 8.3

Quality: 4.5

Yield: 0.0

Momentum: 9.5

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
CVS Health

A-Score: 5.3/10

Value: 4.6

Growth: 4.0

Quality: 2.6

Yield: 6.0

Momentum: 7.5

Volatility: 7.0

1-Year Total Return ->

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Stock-Card
Elevance Health

A-Score: 4.8/10

Value: 6.6

Growth: 5.7

Quality: 6.8

Yield: 3.0

Momentum: 0.5

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
UnitedHealth

A-Score: 4.3/10

Value: 4.9

Growth: 6.1

Quality: 5.1

Yield: 4.0

Momentum: 0.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Humana

A-Score: 4.2/10

Value: 6.0

Growth: 5.3

Quality: 5.2

Yield: 1.0

Momentum: 3.0

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Centene

A-Score: 3.6/10

Value: 9.3

Growth: 5.7

Quality: 3.3

Yield: 0.0

Momentum: 0.0

Volatility: 3.3

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

330.12$

Current Price

330.12$

Potential

-0.00%

Expected Cash-Flows