On Friday, Florida announced the awards for its Statewide Medicaid Managed Care Program.
This includes the state’s two core Medicaid managed care programs, the Managed Medical Assistance and Long-Term Care programs. Centene (NYSE:), Humana (NYSE:), and Elevance Health (ELV) all secured statewide contracts, joining two local players that will combine to serve each region.
CNC shares jumped at the open on Monday, hitting a high of $75.92. The stock is currently at $73.81, up over 4% from Friday’s close. On the other hand, Molina Healthcare’s (NYSE:) share price has declined more than 4% after losing its contract with the state.
In a note to clients reacting to the news, analysts at Oppenheimer said that for Centene, this was the best-case scenario, as it should retain its share, “which is far better than the expectations of significant losses due to its elevated market share.”
Analysts believe the market will see the re-procurement as a significant win for CNC, “which should positively impact the stock, especially given recent disappointments with some smaller re-procurements.”
TD Cowen also released a note covering the news. They wrote: “We believe that investors priced in some level of ceded share for CNC, and we see this result as incrementally positive for the company and a meaningful win for its track record.”