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Centene (CNC) to Report Q3 Earnings: What's in the Cards?

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Centene Corporation (CNC - Free Report) will release third-quarter 2020 results on Oct 27, before the market opens.

Let’s see how things are shaping up for this health insurer prior to this announcement.

For the to-be reported quarter, the company is likely to have gained from solid revenues. Centene is expected to have witnessed membership growth in the third quarter of 2020. The top line is likely to been boosted by the WellCare buyout, growth in Health Insurance Marketplace business, expansions and new programs across many states.

Per the last earnings call, management expected the company's third-quarter earnings per share to be around 20% of the full-year bottom line. Adjusted EPS is anticipated between $4.76 and $4.96. Considering the midpoint, the company's expectation equates to 97 cents, which compares favorably with the Zacks Consensus Estimate of 96 cents. The Zacks Consensus Estimate is flat with the year-ago period’s reported number.

Organic growth, strong Medicaid business, favorable product mix and addition of members via expansion and new programs are expected to have contributed to overall growth.

The consensus mark for the company’s revenues suggests an upside of 49.6% from the year-earlier reported number. Other factors, such as improved premiums might have also supported its top line.

The Zacks Consensus Estimate for the company’s premiums indicates a hike of 46.6% from the prior-year reported number.

The consensus estimate for total membership by business line implies a surge of 62.9% from the year-ago reported figure.

What the Quantitative Model States

Our proven model doesn’t predict an earnings beat for Centene this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a positive surprise, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Centene has an Earnings ESP of 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 96 cents. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Centene Corporation Price and EPS Surprise

Centene Corporation Price and EPS Surprise

Centene Corporation price-eps-surprise | Centene Corporation Quote

Zacks Rank: Centene currently carries a Zacks Rank #2.

Highlights of Q2 Earnings

Centene reported second-quarter 2020 adjusted earnings per share of $2.40, missing the Zacks Consensus Estimate of $2.41 by 0.4%. However, the bottom line soared 79.1% year over year on the back of solid revenues. For the second quarter, total revenues surged 51% to $27.7 billion from the year-ago period, primarily aided by the WellCare buyout, growth in Health Insurance Marketplace business, expansions and new programs across many states in 2019 and 2020 as well as the reinstatement of the health insurer fee in the current year. However, this upside was offset by the Illinois health plan divestiture.

Meanwhile, the top line surpassed the consensus mark by 1.2%.

Stocks to Consider

Some stocks worth considering from the medical sector with the perfect mix of elements to surpass estimates in the next releases are as follows:

Teladoc Health, Inc. (TDOC - Free Report) has an Earnings ESP of +9.77% and a Zacks Rank #3, currently. The company is scheduled to release third-quarter earnings on Oct 28.

Amgen Inc. (AMGN - Free Report) is slated to announce third-quarter earnings on Oct 28. The stock has an Earnings ESP of +0.20% and a Zacks Rank of 3 at present.

Axcella Health Inc. (AXLA - Free Report) is set to report third-quarter earnings on Nov 10. The stock is currently a #3 Ranked player and has an Earnings ESP of +11.25%.

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