Molina Healthcare Cuts Profit Forecast in Latest Warning Sign From Insurers

Molina Healthcare (MOH) reduced its full-year profit expectations as CEO Joseph Zubretsky pointed to rising costs that have outpaced insurance premiums.

The insurer now projects 2025 adjusted earnings of $21.50 to $22.50 per share. That’s down from an estimate of “at least $24.50” when Molina reported first-quarter results in April.

Molina is scheduled to report second-quarter results after the close on July 23. The company expects to post quarterly adjusted EPS of $5.50, which it said is “modestly below” prior expectations. 

‘“The short-term earnings pressure we are experiencing results from what we believe to be a temporary dislocation between premium rates and medical cost trend which has recently accelerated,” Zubretsky said. Nothing has changed Molina’s long-term outlook, including the budget bill signed by President Donald Trump on Friday, he said.

The revision comes after managed-care provider Centene (CNC) withdrew its full-year outlook last week amid slower-than-expected growth. Centene stock tumbled last week, as did Molina’s, which lost nearly a fifth of its value. 

Shares of Molina initially dropped further in early trading Monday but turned positive later in the morning.