Molina Healthcare Earnings Preview

Investors are on the edge of their collective seats, hoping that Molina Healthcare (NYSE: MOH  ) will top analyst expectations for the fifth consecutive quarter. The company will unveil its latest earnings on Thursday, Feb. 23. Molina Healthcare is a multi-state managed care organization participating in government-sponsored health-care programs for low-income persons, such as Medicaid and the Children's Health Insurance Program.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Molina Healthcare, with seven out of 12 analysts rating it a hold. Analysts like Molina Healthcare better than competitor WellCare Health Plans overall. Two out of 12 analysts rate WellCare Health Plans a buy compared to four out of 12 for Molina Healthcare. Analysts still rate the stock a hold, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $1.21 billion in revenue this quarter. That would represent a rise of 12% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.39 per share. Estimates range from $0.35 to $0.43.

What our community says:
CAPS All-Stars are strongly supporting the stock, with 94% assigning it an outperform rating. The community at large backs the All-Stars, with 91.5% awarding it a rating of outperform. Fools are keen on Molina Healthcare, though the message boards have been quiet lately, with only two posts in the past 30 days. Even with a robust four out of five stars, Molina Healthcare's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Molina Healthcare's income has fallen year over year by an average of 87% over the past five quarters.

Now, a look at how efficient management has been at running the business. Traditionally, margins serve as an illustration of how efficiently a company captures portions of sales dollars. Molina Healthcare has seen increasing net margins year over year for the last four quarters. Net margins reflect what percentage of each dollar earned by the company becomes profit. Here is how Molina Healthcare has been doing for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Net Margin

1.6%

1.5%

1.6%

1.6%

One final thing: If you want to keep tabs on Molina Healthcare's movements, and for more analysis on the company, make sure you add it to your Watchlist.

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Earnings estimates provided by Zacks.

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  • Report this Comment On February 22, 2012, at 3:14 PM, Wonderboy5005 wrote:

    Earnings of $.39? How about a $1.00 loss! I guess nobody noticed that Molina lost its Missouri contract and now has to write off $60MM of goodwill . . . put your money anywhere but with this infestation of bad management.

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