U.S. health care insurance provider Centene Corporation (NYSE:CNC) stock surged on Tuesday on better-than-expected first-quarter earnings and 2026 outlook.
The company reported a first-quarter 2026 adjusted loss of $3.37, beating the consensus of $2.13 per share, approximately 50 cents better than the company’s expectations.
• Centene shares are powering higher. Why is CNC stock up today?
Revenue Growth Driven By Medicaid And PDP Strength
Centene’s sales reached $49.94 billion, exceeding the consensus estimate of $47.53 billion.
For the first quarter of 2026, premium and service revenues increased 5% to $44.7 billion, driven by premium yield and membership growth in the PDP business, state-directed payments, and rate increases to address medical trends in the Medicaid business, partially offset by lower Marketplace and Medicaid membership.
In an investor call, the company said, “Medicaid results in the quarter were ahead of our previous projection, outperforming our HBR expectation in the period within that, we experienced a flu season that was lighter than our original forecast and saw a slight utilization benefit from weather events.”
Centene Management Highlights Margin Recovery Progress
Centene’s health benefits ratio (HBR) is 87.3%, marginally down from 87.5% a year ago.
The Medicaid HBR decreased by 50 basis points, primarily driven by rate and revenue increases, continued tangible progress in managing medical costs, and moderate flu costs.
Total membership across Centene’s portfolio declined to 26.27 million from 27.9 million a year ago.
Commercial membership fell from 6.074 million to 4.063 million.
The company said, “Our Medicare segment results were ahead of expectations without performance from both Medicare Advantage and PDP offerings.”
“We continue to make tangible progress in our margin recovery efforts while strengthening the fundamental operations of each of our businesses,” said Centene CEO Sarah London.
Raised 2026 Guidance Signals Confidence
Centene expects fiscal 2026 adjusted earnings of more than $3.40, versus prior guidance of $3 per share, compared to the consensus of $3.02.
The company expects 2026 sales of $187.5 billion-$191.5 billion versus the consensus of $188.91 billion and prior guidance of $186.5 billion-$190.5 billion, including premium revenues between $171 billion and $175 billion (prior guidance of $170 billion-$174 billion).
The health benefits ratio is expected to range between 90.9%-91.7%.
CNC Price Action: Centene shares were up 12.14% at $48.75 at the time of publication on Tuesday, according to Benzinga Pro data.
Photo by JHVEPhoto via Shutterstock
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