Anthem trumped Wall Street third-quarter profit expectations and pushed its 2017 forecast higher, as the health insurer continued to sell more coverage to Medicare customers and employers who need more than just benefit management.
The Blue Cross-Blue Shield insurer said Wednesday that it now expects full-year adjusted earnings to range between $11.90 and $12 per share after predicting greater than $11.70 per share in July.
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Analysts forecast $11.83 per share, according to FactSet.
Anthem covers more than 40 million people as the nation's second-largest health insurer, and most of its business comes from private coverage sold to employers. One element of that segment stood out in the third quarter. The insurer saw enrollment climb more than 3 percent to nearly 15.9 million people in its "local group" business.
That segment includes employer-sponsored coverage for companies with less than 5,000 people. This is generally a more profitable business for insurers like Anthem than larger clients who pay their own medical bills and hire an insurer to manage the coverage.
Anthem's Medicare enrollment also climbed more than 4 percent to 1.5 million, and the insurer also was helped by a drop in expenses tied to its failed bid to acquire rival insurer Cigna.
Overall, the Indianapolis insurer's earnings climbed 21 percent to $746.9 million, and earnings adjusted for one-time items totaled $2.65 per share. Excluding investment gains and one-time items, operating revenue rose 4.6 percent to $22.1 billion.
Analysts expected earnings of $2.41 per share on $22.43 billion in revenue, according to Zacks Investment Research.
Anthem Inc. shares have climbed 36 percent since the beginning of the year. The stock has climbed 57 percent in the last 12 months.
Elements of this story were generated by Automated Insights using data from Zacks Investment Research. Access a Zacks stock report on ANTM at https://www.zacks.com/ap/ANTM