The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Centene beat expectations on revenue and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue improved significantly and GAAP earnings per share expanded.
Margins dropped across the board.
Centene booked revenue of $1.51 billion. The 14 analysts polled by S&P Capital IQ predicted revenue of $1.43 billion on the same basis. GAAP reported sales were 28% higher than the prior-year quarter's $1.18 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.57. The 17 earnings estimates compiled by S&P Capital IQ predicted $0.55 per share. GAAP EPS of $0.57 for Q4 were 14% higher than the prior-year quarter's $0.50 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 18.4%, 370 basis points worse than the prior-year quarter. Operating margin was 3.4%, 70 basis points worse than the prior-year quarter. Net margin was 2.0%, 10 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.67 billion. On the bottom line, the average EPS estimate is $0.48.
Next year's average estimate for revenue is $7.53 billion. The average EPS estimate is $2.72.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Centene is outperform, with an average price target of $41.63.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.