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Alignment Healthcare
(NASDAQ:ALHC)
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Rating:59Neutral
Price Target:
$9.00
▼(-33.77% Downside)
Action:Reiterated
Date:10/09/26
The score is driven primarily by improving financial performance (strong cash generation and a turn to profitability) and a supportive earnings outlook with raised guidance. These positives are tempered by weak technicals (price below key moving averages with negative MACD), a relatively high P/E without a dividend, and a notable Star Ratings downgrade that adds medium-term reimbursement risk.
Positive Factors
Strong membership and revenue growth
Rapid membership expansion and sustained revenue growth indicate strong demand for Alignment’s Medicare Advantage offering. A larger enrolled base can improve operating scale, deepen clinical data advantages, and create a broader platform for recurring capitation revenue over the next several quarters.
Negative Factors
Major California Star Ratings downgrade
The downgrade affects the contract serving most members, creating a material medium-term risk to Medicare Advantage quality bonus revenue. Although no 2026 or 2027 revenue impact is expected, restoring ratings will require successful quality initiatives while reimbursement methodologies continue to evolve.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong membership and revenue growth
Rapid membership expansion and sustained revenue growth indicate strong demand for Alignment’s Medicare Advantage offering. A larger enrolled base can improve operating scale, deepen clinical data advantages, and create a broader platform for recurring capitation revenue over the next several quarters.
Read all positive factors
Alignment Healthcare (ALHC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.81B
Dividend YieldN/A
Average Volume (3M)10.28M
Price to Earnings (P/E)37.9
Beta (1Y)0.58
Revenue Growth37.21%
EPS GrowthN/A
CountryUS
Employees1,849
SectorHealthcare
Sector Strength45
IndustryMedical - Healthcare Plans
Share Statistics
EPS (TTM)0.20
Shares Outstanding207,435,150
10 Day Avg. Volume10,271,504
30 Day Avg. Volume10,279,494
Financial Highlights & Ratios
PEG Ratio53.67
Price to Book (P/B)21.81
Price to Sales (P/S)0.99
P/FCF Ratio34.56
Enterprise Value/Market Cap3.02
Enterprise Value/Revenue1.19
Enterprise Value/Gross Profit9.49
Enterprise Value/Ebitda62.98
Forecast
1Y Price Target
$15.14Price Target Upside11.43% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)0.16
Revenue Forecast (FY)$5.21B
Alignment Healthcare Business Overview & Revenue Model
Company Description
Alignment Healthcare, Inc. is a technology-driven Medicare Advantage provider operating a healthcare platform focused squarely on the consumer. This organization delivers personalized medical services across the United States, primarily for elderl...
How the Company Makes Money
Alignment Healthcare makes money primarily by offering Medicare Advantage plans and receiving monthly capitation payments from the Centers for Medicare & Medicaid Services (CMS) for each enrolled member. These payments are set on a per-member-per-...
Alignment Healthcare Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 29, 2026
Earnings Call Sentiment Positive
The call presents a strong growth and margin-improvement story: membership and revenue grew ~31%-32% YoY, adjusted EBITDA rose 48% YoY, MBR improved ~40 bps, cash and leverage are healthy, and management raised revenue and profitability guidance while outlining sizable embedded earnings potential and meaningful clinical/AI investments. Offsetting these positives are intentional near-term investments that will increase Q3/Q4 MBR and SG&A (potentially a double-digit million impact), a smaller-than-last-year new-member sweep benefit, a modest prior-year reserve build (~$6M) and regulatory uncertainty. On balance, the company demonstrates operational execution and scalability while accepting some short-term cost headwinds to pursue longer-term growth and portability.Positive Updates
Strong Membership Growth
Health plan membership reached 294,000 in Q2, up ~31% year-over-year, driven by strong new member additions and high retention; company raised its membership outlook for the year (Q3 guide: 296k-298k; FY guide: ~298k).
Negative Updates
Near-term Investment-Driven Headwinds
Management plans additional investments in Q3 (clinical hiring, AVA Care Anywhere ramp, automation) and SG&A (branding, market launches) that could constitute an additional double-digit million impact in H2 (weighting higher in Q3), producing a seasonally higher MBR and greater SG&A cadence in Q3 versus prior years.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Membership Growth
Health plan membership reached 294,000 in Q2, up ~31% year-over-year, driven by strong new member additions and high retention; company raised its membership outlook for the year (Q3 guide: 296k-298k; FY guide: ~298k).
Read all positive updates
Company Guidance
Alignment guided full‑year 2026 membership at roughly 298k, revenue of $5.20–5.23 billion, adjusted gross profit of $630–650 million and adjusted EBITDA of $145–163 million (midpoint $154M), noting ~32% revenue growth year‑over‑year; Q3 guidance calls for 296–298k members, $1.30–1.32 billion of revenue, $148–158 million of adjusted gross profit and $20–30 million of adjusted EBITDA. Management said first‑half adjusted EBITDA was $106M and that they are on track to the midpoint, expect ~30% of full‑year adjusted EBITDA in H2 (vs. ~40% prior year) due to a flatter Part D MBR and planned investments, raised the low end of FY adjusted gross profit by $10M and adj EBITDA low end by $7M, and signaled potential incremental H2 investments (clinical and SG&A) in the double‑digit millions (weighted to Q3); they ended Q2 with $702M cash, $111M operating cash flow YTD and funded leverage of 2.2x trailing‑12‑month EBITDA.Alignment Healthcare Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
55
Neutral
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.58B | 3.95B | 2.70B | 1.82B | 1.43B | 1.17B |
| Gross Profit | 574.42M | 488.56M | 296.69M | 201.03M | 184.28M | 128.73M |
| EBITDA | 86.54M | 45.32M | -77.44M | -105.30M | -113.53M | -161.81M |
| Net Income | 40.70M | -724.00K | -128.03M | -148.02M | -149.55M | -195.29M |
Balance Sheet | ||||||
| Total Assets | 1.28B | 1.07B | 782.06M | 591.88M | 633.86M | 630.89M |
| Cash, Cash Equivalents and Short-Term Investments | 701.71M | 604.23M | 470.65M | 318.82M | 409.55M | 466.60M |
| Total Debt | 330.50M | 329.64M | 329.26M | 170.79M | 164.60M | 157.59M |
| Total Liabilities | 1.01B | 886.51M | 681.11M | 433.81M | 394.56M | 324.84M |
| Stockholders Equity | 265.13M | 179.28M | 99.85M | 156.95M | 238.13M | 306.04M |
Cash Flow | ||||||
| Free Cash Flow | 205.55M | 113.15M | -6.65M | -95.18M | -69.20M | -97.14M |
| Operating Cash Flow | 205.55M | 139.93M | 34.77M | -59.19M | -45.43M | -78.78M |
| Investing Cash Flow | -1.85M | -14.97M | 39.19M | -147.26M | -28.22M | -20.82M |
| Financing Cash Flow | 19.53M | 18.04M | 156.03M | 105.00K | 16.59M | 360.13M |
Alignment Healthcare Technical Analysis
Negative
13.59
Price Trends
11.74
Negative
15.59
Negative
17.78
Negative
Market Momentum
-1.16
Negative
37.61
Neutral
82.40
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALHC, the sentiment is Negative. The current price of 13.59 is above the 20-day moving average (MA) of 8.78, above the 50-day MA of 11.74, and below the 200-day MA of 17.78, indicating a bearish trend. The MACD of -1.16 indicates Negative momentum. The RSI at 37.61 is Neutral, neither overbought nor oversold. The STOCH value of 82.40 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALHC.
Alignment Healthcare Risk Analysis
Alignment Healthcare disclosed 62 risk factors in its most recent earnings report. Alignment Healthcare reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alignment Healthcare Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $2.43B | -119.88 | -5.38% | 1.23% | 54.04% | 57.31% | |
70 Outperform | $332.96B | 24.55 | 14.63% | 2.44% | 6.46% | -32.89% | |
70 Outperform | $86.95B | 18.45 | 11.24% | 1.71% | 6.27% | -4.37% | |
62 Neutral | $112.29B | 22.77 | 6.43% | 3.03% | 7.41% | 6.51% | |
61 Neutral | $46.49B | 40.63 | 6.91% | 0.91% | 18.33% | -18.53% | |
59 Neutral | $1.81B | 37.92 | 20.02% | ― | 37.21% | ― | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
ALHC
Alignment Healthcare
7.55
-9.76
-56.41%
CVS
CVS Health
86.16
10.13
13.33%
HUM
Humana
431.87
163.79
61.10%
UNH
UnitedHealth
379.30
29.94
8.57%
ELV
Elevance Health
412.70
68.13
19.77%
CLOV
Clover Health Investments
4.79
2.16
82.13%
Alignment Healthcare Corporate Events
Business Operations and StrategyFinancial DisclosuresLegal Proceedings
Alignment Healthcare Addresses 2027 Star Ratings Downgrade
Negative
Oct 8, 2026
On October 8, 2026, the Centers for Medicare Medicaid Services released 2027 Star Ratings showing Alignment Healthcare’s key California HMO contract H3815 falling to 3.5 stars from 4.0, affecting about 75% of its membership, while its six o...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.