What happened
Shares of Evolent Health (EVH -2.37%) rose more than 22% in early trading Thursday. The healthcare services stock, which closed at $22.21 on Wednesday, opened at $24.37 on Thursday and rose to a high of $27.03 in the first hour of trading. The stock has a 52-week low of $17.50 and a high of $34.60. The stock is down more than 6% this year but up more than 31% over the past 12 months. The stock's rise came on a day when it seemed most stocks saw their shares plummet.
So what
The stock rose after the company had good news in its fourth-quarter earnings, which were released before the market closed on Thursday. The company provides integrated and simplified administrative operations, risk adjustment, pharmacy management benefits, and an integrated platform for both healthcare payers and providers. Simply put, it functions to keep healthcare costs down.
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In Q4, the company reported revenue of $248.4 million, up 0.7% year over year, while revenue, excluding revenue from divested assets, was up 39.7% from the same period in 2020.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were listed as $24.3 million. Perhaps most importantly, the company posted annual adjusted earnings per share (EPS) of $0.02 compared to an adjusted EPS loss of $0.14 in 2020.
The company also listed guidance of 2022 Q1 revenue of $280 million to $295 million and adjusted EBITDA between $20 million and $25 million.
Now what
The healthcare company's platform now covers 19.9 million people, roughly 6% of the U.S. population. That number is up from 9.8 million last year. With its business growing, Evolent now appears closer to achieving what it hasn't done since its founding 10 years ago -- showing a profit. It has done this by continually adding more partners; as of Dec. 31, the company had 44 partners, up from 37 in 2020.
There's plenty of potential growth for Evolent. According to company figures, $4.1 trillion was spent on healthcare in the United States in 2020, with approximately 20% of those payments tied to performance or value-based models. This trend in healthcare benefits companies like Evolent, which works to bring down costs for insurers.
