Healthcare company Agilon Health (NYSE:AGL) cratered in trading after trimming its FY23 outlook and providing early guidance for FY24. The company now expects FY23 revenues in the range of $4.30 billion to $4.31 billion, compared to its prior guidance of between $4.3 billion and $4.32 billion. This was below consensus estimates of $4.6 billion.
Adjusted EBITDA is forecasted to be between -$55 million and -$69 million compared to its prior estimate of $6 million to $18 million. For FY24, the company expects total revenues to be between $6.35 billion and $6.42 billion against an estimate of $6.06 billion. Adjusted EBITDA is estimated between $40 million and $60 million.
Steve Sell, Agilon’s CEO, commented, “Higher-than-expected costs became visible to us in mid-December during the November close process given updated data from health plans and will impact our FY2023 medical margins.”
As a result, the company has lowered its Medicare Advantage medical margin guidance for 2023 to a range of $340 million to $360 million, around $110 million below the previous guidance range.
Meanwhile, the company also announced the retirement of Timothy Bensley from his position as CFO in 2024. The firm has already started a search for a new CFO, and Bensley has agreed to “remain as CFO through this process and serve in a consulting role through the transition.”
What is the Price Target for AGL Stock?
Analysts remain cautiously optimistic about AGL stock with a Moderate Buy consensus rating based on 11 Buys and four Holds. Over the past year, AGL stock has declined by more than 20%, and the average AGL price target of $19.21 implies an upside potential of 140.3% at current levels.
