It has been about a month since the last earnings report for Molina (MOH Quick QuoteMOH - Free Report) . Shares have added about 3.3% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Molina due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Molina Healthcare Q4 Earnings Beat on Higher Premiums

Molina Healthcare reported fourth-quarter 2021 adjusted earnings of $2.88 per share, beating the Zacks Consensus Estimate of $2.82. Also, the bottom line significantly improved from the year-ago loss of 51 cents per share.

Total revenues of $7,409 million beat the consensus mark of $7,126 million. The top line also surged from the year-ago level of $5,235 million.

The strong fourth-quarter results were supported by increased membership and premiums. Lower impact from COVID also aided the results.

Operational Update

Premium revenues for the company increased 47.6% year over year to $7,166 million on the back of positive impacts from acquisitions and organic membership growth.

Total operating expenses shot up to $7,218 million for the fourth quarter from $5,144 million a year ago, primarily due to higher medical care costs, general and administrative expenses as well as premium tax expenses. Molina Healthcare’s interest expenses remained flat year over year at $30 million.

The company’s net income totaled $103 million, up from $34 million a year ago.

Medical care ratio (medical costs as a percentage of premium revenue) for the fourth quarter was 88.8%, down from 90.8% in the year-ago period.

Total membership at fourth quarter-end increased 29% year over year to 5.2 million, reflecting improving business.

Financial Update (as of Dec 31, 2021)

Molina Healthcare’s cash and cash equivalents rose to $4,438 million at fourth quarter-end from $4,357 million at third quarter-end. Total assets rose to $12,209 million from $11,033 million at September quarter-end.

Long-term debt at fourth quarter-end was $2,173 million, marginally up sequentially from $2,130 million.

The company’s shareholder equity improved to $2,630 million sequentially from $2,518 million.

Net cash flow provided by operating activities was $2,119 million in 2021, up from $1,898 million a year ago.

Guidance

Molina Healthcare expects its 2022 business to witness reduced impacts from COVID. Strong Medicare and Medicaid performance will buoy results.

Premium revenues for 2022 are projected to be $28.5 billion, indicating a rise from the 2021 level of $26.9 billion. Total revenues for 2022 are anticipated to be $29.5 billion, suggesting an increase from $27.8 billion in 2021.

Adjusted earnings per share for 2022 are expected at $17, implying growth from $13.54 in 2021.

Total membership at 2022-end is anticipated at 4.5 million, pointing to a decline from the 2021 level of 5.2 million. Medical care ratio for 2022 is expected at 88%, calling for a decrease from 88.3% in 2021.

How Have Estimates Been Moving Since Then?

It turns out, estimates review flatlined during the past month.

VGM Scores

At this time, Molina has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Molina has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.