Anthem Inc. beat earnings estimates in its latest quarter and raised the low end of its full-year guidance as increased insurance premiums and stronger Medicaid and Medicare enrollment gave the company a boost.
The insurer said Wednesday it expects to earn more than previously expected this year but cover slightly fewer people.
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Anthem increased its 2017 adjusted earnings per share guidance to a range of $11.90 to $12, up from more than $11.70. The company lowered its expected enrollment to between 40 million and 40.2 million people, down from between 40.2 million and 40.4 million.
It said 40.3 million people were enrolled in its plans at the end of the third quarter, up less than 1% from a year ago.
Premium rate increases and stronger enrollment in Medicaid and Medicare plans helped increase third-quarter revenue 4.6% from a year ago to $22.1 billion.
The latest financial results come as the Indianapolis company navigates uncertain waters in terms of national health-care policy. On Tuesday it announced a deal to buy America's 1st Choice, a privately held Medicare Advantage provider that serves about 130,000 people in Florida and South Carolina. Financial terms of the deal weren't disclosed, but Anthem expects the purchase to close in the first quarter of next year.
Last week, Anthem said it would launch its own pharmacy-benefit manager in 2020 and team with CVS Health Corp. The new company, IngenioRx, will serve Anthem and non-Anthem customers.
Anthem had already decided not to renew its existing arrangement with Express Scripts Holding Co., which counted Anthem's $17 billion contract as its biggest, after a pricing disagreement turned into a legal battle.
Overall for the third quarter, Anthem reported a profit of $746.9 million, or $2.80 a share, compared with $617.8 million, or $2.30 a share, a year ago.
Excluding one-time items, the company earned $2.65 per share, compared with $2.45 a year ago. Analysts polled by Thomson Reuters had expected $2.42 in adjusted earnings per share.
The Indianapolis company reiterated its full-year revenue outlook of between $88.5 billion and $89.5 billion.
Anthem's shares are up 36% this year. They were inactive premarket Wednesday.
Write to Cara Lombardo at firstname.lastname@example.org
(END) Dow Jones Newswires
October 25, 2017 07:12 ET (11:12 GMT)