Centene (1CNC) Q3 2026 Earnings Report

The call was strongly positive overall. Centene delivered a better-than-expected third quarter, raised 2026 adjusted EPS guidance from more than $4.80 to more than $5.20, reported strong Medicare and Marketplace performance, reached an earlier-than-expected Medicare Advantage breakeven target, reduced debt, and described multiple operating and cost-management improvements. The primary challenges were Medicaid membership declines and work-requirement-related acuity risks, expected Medicare Advantage membership contraction, Marketplace membership attrition and program-integrity costs, the planned commercial-group exit, and a likely PDP margin reset in 2027. Highlights significantly outweighed the lowlights.

Centene raised 2026 adjusted diluted EPS guidance to >$5.20, with a full-year Medicaid HBR of approximately 93.5%, Medicaid membership down 8% to 9% year over year, a composite Medicaid rate of ~5%, Medicare Advantage reaching breakeven, PDP pretax margins in the mid- to high 3s, Marketplace pretax margin at the top of the previous 4.5% to 5.0% range, year-end Marketplace membership around 3.2 million, a full-year SG&A ratio midpoint of 7.2%, approximately $1.5 billion of investment and other income, and interest expense at a midpoint of $610 million; for 2027, the company expects to grow adjusted EPS relative to both the $4.70 jump off point and the revised $5.20 2026 guidance, with slight improvement in Medicaid HBR, Medicare Advantage better than breakeven, PDP membership growth, an improved SG&A rate, Medicaid membership attrition from OB 3, Medicare Advantage membership down year over year, Marketplace slight contraction, and an opening PDP margin expectation probably somewhere in 2% to 3% range.