We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
OSCR Q3 Earnings Call Highlights Strong Outlook and Margin Gains
Read MoreHide Full Article
Key Takeaways
OSCR raises its 2026 operating earnings guidance to $850-$950M on favorable medical cost trends.
OSCR medical loss ratio rises 450 basis points to 84%, while its SG&A expense ratio falls to a record-low 14%.
Oscar aims 2027 market share gains across 713 counties and 21 states, supported by new products and expansion.
Oscar Health, Inc. (OSCR - Free Report) emphasized improved profitability, disciplined pricing and expanding market opportunities during its third-quarter 2026 earnings call. Management highlighted stronger medical cost performance and operating efficiencies that supported another increase in full-year guidance.
The insurer expects continued market share gains in 2027 despite enrollment verification changes and evolving Affordable Care Act (ACA) market conditions. Its expanding product portfolio and technology investments remain central to its growth strategy.
OSCR reported a third-quarter loss of 49 cents per share, wider than the Zacks Consensus Estimate of a loss of 11 cents. Revenues totaled $5.14 billion, surpassing the Zacks Consensus Estimate of $4.72 billion. Revenues increased approximately 70% year over year, supported by higher membership and premium rate increases.
Oscar Health, Inc. Price, Consensus and EPS Surprise
CEO Mark Bertolini highlighted record profitability for the first nine months of 2026, with earnings from operations reaching $1.3 billion.
Management raised its full-year earnings from operations guidance for the third time to $850-$950 million, reflecting stronger risk adjustment results and favorable medical utilization.
CFO Scott Blackley also increased the revenue outlook to $19-$19.3 billion. The revised operating earnings guidance midpoint stands $200 million above the previous forecast.
OSCR Benefits From Improved Medical Cost Trends
Oscar reported a third-quarter medical loss ratio (MLR) of 84%, improving 450 basis points year over year. Its SG&A expense ratio declined 350 basis points to a record-low 14%.
Blackley attributed the improvement to disciplined pricing, operating leverage and technology-driven efficiencies.
During the Q&A, a Wells Fargo analyst questioned the relationship between favorable risk adjustment and medical cost improvements. Blackley clarified that the $250 million risk adjustment benefit was partially offset by associated claims expenses, emphasizing the company's cautious reserving approach.
Oscar Targets Market Share Gains in 2027
Bertolini highlighted the company's expanding presence across 713 counties and 21 states, representing a 24% larger footprint for the upcoming enrollment period.
Management expects the broader ACA marketplace to remain relatively stable in 2027 while Oscar benefits from new markets, differentiated products and competitor exits.
During the Q&A, a Barclays analyst questioned anticipated share gains. Bertolini identified approximately 850,000 potential members affected by competitor exits, alongside opportunities from new products and geographic expansion.
OSCR Adjusts Pricing for Higher Medical Costs
Oscar plans a weighted average premium rate increase of approximately 14% for 2027, reflecting elevated medical cost trends and higher expected market morbidity.
Blackley explained that underlying medical cost inflation, anticipated in the high-single-digit range, represents the largest component of the increase.
A Goldman Sachs analyst sought further clarification on pricing assumptions. Management emphasized network economics, distribution relationships and disciplined underwriting, with additional margin improvement incorporated into its pricing strategy.
Oscar Expands Products and Technology Capabilities
Bertolini outlined new offerings targeting early retirees, small businesses and underserved consumer segments, including RetireEase and expanded CHOICE products.
The company's Lucie technology platform is expected to facilitate approximately 800,000 new policy sales in 2027, supported by growing broker adoption.
Management also highlighted AI-driven administrative efficiencies and bundled supplemental coverage partnerships designed to improve affordability and strengthen customer retention.
OSCR Maintains Focus on Sustainable Growth
Management expects further margin expansion in 2027, supported by competitive pricing, improved medical cost performance and administrative efficiencies.
Bertolini reiterated the company's long-term objective of generating at least $4 in earnings per share by 2029.
The company remains focused on balancing membership growth with profitability as enrollment requirements and ACA market conditions evolve.
What Zacks Rank and Style Scores Indicate for OSCR
Oscar currently carries a Zacks Rank #1 (Strong Buy), indicating a favorable near-term earnings estimate revision outlook. Its Growth Score of A and Value Score of B reflect attractive growth and valuation characteristics, while its Momentum Score of F indicates weaker price momentum. You can see the complete list of today’s Zacks #1 Rank stocks here.
The stock's VGM Score of A reflects favorable combined value, growth and momentum characteristics under the Zacks framework. Its combination of a Zacks Rank #1 and an A-rated VGM Score is generally viewed favorably within the methodology. However, the Zacks Rank can change as analysts revise their earnings estimates following the latest quarterly results.
View the Zacks #1 Rank List
Image: Bigstock
OSCR Q3 Earnings Call Highlights Strong Outlook and Margin Gains
Key Takeaways
Oscar Health, Inc. (OSCR - Free Report) emphasized improved profitability, disciplined pricing and expanding market opportunities during its third-quarter 2026 earnings call. Management highlighted stronger medical cost performance and operating efficiencies that supported another increase in full-year guidance.
The insurer expects continued market share gains in 2027 despite enrollment verification changes and evolving Affordable Care Act (ACA) market conditions. Its expanding product portfolio and technology investments remain central to its growth strategy.
OSCR reported a third-quarter loss of 49 cents per share, wider than the Zacks Consensus Estimate of a loss of 11 cents. Revenues totaled $5.14 billion, surpassing the Zacks Consensus Estimate of $4.72 billion. Revenues increased approximately 70% year over year, supported by higher membership and premium rate increases.
Oscar Health, Inc. Price, Consensus and EPS Surprise
Oscar Health, Inc. price-consensus-eps-surprise-chart | Oscar Health, Inc. Quote
Oscar Raises Its 2026 Earnings Outlook
CEO Mark Bertolini highlighted record profitability for the first nine months of 2026, with earnings from operations reaching $1.3 billion.
Management raised its full-year earnings from operations guidance for the third time to $850-$950 million, reflecting stronger risk adjustment results and favorable medical utilization.
CFO Scott Blackley also increased the revenue outlook to $19-$19.3 billion. The revised operating earnings guidance midpoint stands $200 million above the previous forecast.
OSCR Benefits From Improved Medical Cost Trends
Oscar reported a third-quarter medical loss ratio (MLR) of 84%, improving 450 basis points year over year. Its SG&A expense ratio declined 350 basis points to a record-low 14%.
Blackley attributed the improvement to disciplined pricing, operating leverage and technology-driven efficiencies.
During the Q&A, a Wells Fargo analyst questioned the relationship between favorable risk adjustment and medical cost improvements. Blackley clarified that the $250 million risk adjustment benefit was partially offset by associated claims expenses, emphasizing the company's cautious reserving approach.
Oscar Targets Market Share Gains in 2027
Bertolini highlighted the company's expanding presence across 713 counties and 21 states, representing a 24% larger footprint for the upcoming enrollment period.
Management expects the broader ACA marketplace to remain relatively stable in 2027 while Oscar benefits from new markets, differentiated products and competitor exits.
During the Q&A, a Barclays analyst questioned anticipated share gains. Bertolini identified approximately 850,000 potential members affected by competitor exits, alongside opportunities from new products and geographic expansion.
OSCR Adjusts Pricing for Higher Medical Costs
Oscar plans a weighted average premium rate increase of approximately 14% for 2027, reflecting elevated medical cost trends and higher expected market morbidity.
Blackley explained that underlying medical cost inflation, anticipated in the high-single-digit range, represents the largest component of the increase.
A Goldman Sachs analyst sought further clarification on pricing assumptions. Management emphasized network economics, distribution relationships and disciplined underwriting, with additional margin improvement incorporated into its pricing strategy.
Oscar Expands Products and Technology Capabilities
Bertolini outlined new offerings targeting early retirees, small businesses and underserved consumer segments, including RetireEase and expanded CHOICE products.
The company's Lucie technology platform is expected to facilitate approximately 800,000 new policy sales in 2027, supported by growing broker adoption.
Management also highlighted AI-driven administrative efficiencies and bundled supplemental coverage partnerships designed to improve affordability and strengthen customer retention.
OSCR Maintains Focus on Sustainable Growth
Management expects further margin expansion in 2027, supported by competitive pricing, improved medical cost performance and administrative efficiencies.
Bertolini reiterated the company's long-term objective of generating at least $4 in earnings per share by 2029.
The company remains focused on balancing membership growth with profitability as enrollment requirements and ACA market conditions evolve.
What Zacks Rank and Style Scores Indicate for OSCR
Oscar currently carries a Zacks Rank #1 (Strong Buy), indicating a favorable near-term earnings estimate revision outlook. Its Growth Score of A and Value Score of B reflect attractive growth and valuation characteristics, while its Momentum Score of F indicates weaker price momentum. You can see the complete list of today’s Zacks #1 Rank stocks here.
The stock's VGM Score of A reflects favorable combined value, growth and momentum characteristics under the Zacks framework. Its combination of a Zacks Rank #1 and an A-rated VGM Score is generally viewed favorably within the methodology. However, the Zacks Rank can change as analysts revise their earnings estimates following the latest quarterly results.