Molina Healthcare, Inc. (MOH) Bundle
A Brief History of Molina Healthcare, Inc.
Company Overview
Molina Healthcare, Inc. is a FORTUNE 500 company providing managed healthcare services under the Medicaid and Medicare programs, as well as through state insurance marketplaces. As of September 30, 2024, Molina serves approximately 5.6 million members across 21 states.
Recent Financial Performance
In the third quarter of 2024, Molina Healthcare reported:
- Net income: $326 million, or $5.65 per diluted share, compared to $245 million, or $4.21 per diluted share in the same quarter of 2023.
- Premium revenue: $9.7 billion, up 18% from $8.2 billion year-over-year.
- Medical care ratio (MCR): 89.2%, compared to 88.7% in the third quarter of 2023.
- Investment income: $118 million, an increase of 5% year-over-year.
- General and administrative (G&A) expense ratio: 6.5%, a decrease from 7.1% in the previous year.
- After-tax margin: 3.2%, consistent with expectations.
Consolidated Financial Summary
The following table outlines key financial metrics for Molina Healthcare for the three and nine months ended September 30, 2024, compared to the same periods in 2023:
| Metrics | Q3 2024 (in millions) | Q3 2023 (in millions) | 9M 2024 (in millions) | 9M 2023 (in millions) |
|---|---|---|---|---|
| Premium Revenue | $9,694 | $8,240 | $28,644 | $24,167 |
| Medical Care Costs | $8,643 | $7,306 | $25,425 | $21,215 |
| Medical Margin | $1,051 | $934 | $3,219 | $2,952 |
| Operating Income | $467 | $359 | $1,327 | $1,257 |
| Net Income | $326 | $245 | $928 | $875 |
| Net Income per Share (Diluted) | $5.65 | $4.21 | $15.97 | $15.08 |
Membership Growth
As of September 30, 2024, Molina Healthcare experienced an increase in membership by 392,000 members or 8% compared to the prior year. This growth was attributed to new Medicaid contracts, acquisitions, and expansion of their existing footprint.
Acquisitions and Expansions
On January 1, 2024, Molina completed the acquisition of Bright Health Medicare for $441 million. This acquisition aligns with Molina's strategy to expand its services in existing markets.
Cash Flow Activities
For the nine months ended September 30, 2024, Molina reported:
- Net cash provided by operating activities: $868 million.
- Net cash used in investing activities: $483 million.
- Net cash used in financing activities: $414 million.
Liquidity and Financial Condition
As of September 30, 2024, Molina's total assets were $15.8 billion, with total liabilities of $11 billion, resulting in stockholders' equity of $4.77 billion.
Outlook
Molina anticipates continued growth and operational improvements, driven by its Medicaid and Medicare programs as well as strategic acquisitions. The company has also initiated a new stock repurchase program of up to $1 billion authorized in October 2024.
A Who Owns Molina Healthcare, Inc. (MOH)
Ownership Structure
As of 2024, Molina Healthcare, Inc. (MOH) is publicly traded on the NYSE. The ownership of the company is divided among institutional investors, mutual funds, and individual shareholders. The largest shareholders include major investment firms that hold significant stakes in the company.
Top Institutional Shareholders
| Institution | Shares Owned | Percentage of Ownership |
|---|---|---|
| The Vanguard Group, Inc. | 9,600,000 | 16.5% |
| BlackRock, Inc. | 8,800,000 | 15.2% |
| SSgA Funds Management, Inc. | 5,500,000 | 9.5% |
| Wellington Management Co. LLP | 5,200,000 | 9.0% |
| Fidelity Management & Research Company | 4,700,000 | 8.1% |
Recent Stock Performance
As of September 30, 2024, Molina Healthcare's stock performance has shown significant growth, with a year-to-date increase of approximately 25%. The closing price on that date was $341.16, reflecting a robust market response to the company's earnings and strategic acquisitions made within the year.
Market Capitalization
The market capitalization of Molina Healthcare, Inc. as of September 30, 2024, was approximately $19 billion, indicating a strong position within the healthcare sector.
Shareholder Equity
| Metric | Value |
|---|---|
| Total Stockholders' Equity | $4,770 million |
| Total Assets | $15,758 million |
| Total Liabilities | $11,988 million |
Recent Developments
Molina Healthcare has been actively engaged in acquisitions to expand its market presence. Notable acquisitions include the purchase of Bright Health Medicare for $441 million, which closed on January 1, 2024. This strategic move aims to enhance their service offerings and increase membership across existing markets.
Membership Growth
As of September 30, 2024, Molina Healthcare reported a membership of 5.6 million, which marks an increase of 392,000 members, or 8%, compared to the previous year. This growth is attributed to new Medicaid contract wins and successful integration of recent acquisitions.
Financial Performance
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Income | $326 million | $245 million |
| Premium Revenue | $9.7 billion | $8.2 billion |
| Medical Care Ratio (MCR) | 89.2% | 88.7% |
| After-tax Margin | 3.2% | 2.9% |
Molina Healthcare, Inc. (MOH) Mission Statement
Company Overview
Molina Healthcare, Inc. is a FORTUNE 500 company that provides managed healthcare services primarily under the Medicaid and Medicare programs. As of September 30, 2024, Molina serves approximately 5.6 million members across 21 states.
Mission Statement
Molina Healthcare's mission statement emphasizes providing quality healthcare to those who need it most, focusing on vulnerable populations and ensuring accessible, affordable care. The company aims to deliver innovative solutions that enhance the health and well-being of its members.
Key Financial Metrics
As of the third quarter of 2024, Molina Healthcare reported significant growth in its financial performance, reflecting its mission-driven approach.
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Income (in millions) | $326 | $245 | 33% |
| Net Income per Share (Diluted) | $5.65 | $4.21 | 34% |
| Premium Revenue (in millions) | $9,694 | $8,240 | 18% |
| Ending Membership (in millions) | 5.6 | 5.2 | 8% |
| Medical Care Ratio (MCR) | 89.2% | 88.7% | 0.5% |
| Investment Income (in millions) | $118 | $112 | 5% |
| General and Administrative Expense Ratio | 6.5% | 7.1% | -0.6% |
Segment Performance
Molina Healthcare operates through several segments, including Medicaid, Medicare, and Marketplace. Each segment contributes to the overall mission by focusing on specific populations and healthcare needs.
| Segment | Q3 2024 Premium Revenue (in millions) | Q3 2023 Premium Revenue (in millions) | Change (%) |
|---|---|---|---|
| Medicaid | $8,263 | $6,976 | 18% |
| Medicare | $1,385 | $1,046 | 32% |
| Marketplace | $672 | $507 | 32% |
Strategic Initiatives
Molina Healthcare's strategic initiatives include expanding its footprint through new Medicaid contracts and acquisitions, which have been significant contributors to its growth. For instance, the acquisition of Bright Health Medicare on January 1, 2024, for $441 million, aligns with Molina's strategy to enhance service delivery and access to care for its members.
Conclusion of Financial Overview
The financial results for the third quarter of 2024 showcase Molina Healthcare's commitment to its mission by providing quality healthcare services while achieving substantial growth in revenue and membership. The company continues to focus on operational efficiency, as evidenced by its decreasing G&A ratio and increasing net income.
How Molina Healthcare, Inc. (MOH) Works
Company Overview
Molina Healthcare, Inc. operates as a managed care organization, providing healthcare services under Medicaid, Medicare, and Marketplace programs. As of September 30, 2024, Molina served approximately 5.6 million members across 21 states.
Financial Performance
In the third quarter of 2024, Molina Healthcare reported:
- Net income of $326 million, or $5.65 per diluted share, compared to $245 million, or $4.21 per diluted share in Q3 2023.
- Premium revenue of $9.7 billion, an 18% increase from $8.2 billion in Q3 2023.
- Consolidated medical care ratio (MCR) of 89.2%, up from 88.7% in Q3 2023.
- General and administrative expense (G&A) ratio of 6.5%, improved from 7.1% in Q3 2023.
Membership Growth
As of September 30, 2024, Molina's membership reached 5.6 million, representing an increase of 392,000 members, or 8%, compared to the same date in 2023. This growth is attributed to:
- New Medicaid contract wins.
- Acquisitions.
- Expansion in existing markets.
Segment Financial Performance
| Segment | Premium Revenue (Q3 2024) | Medical Margin (Q3 2024) | MCR (Q3 2024) | Premium Revenue (Q3 2023) | Medical Margin (Q3 2023) | MCR (Q3 2023) |
|---|---|---|---|---|---|---|
| Medicaid | $7,668 million | $730 million | 90.5% | $6,711 million | $752 million | 88.8% |
| Medicare | $1,367 million | $142 million | 89.6% | $1,032 million | $78 million | 92.4% |
| Marketplace | $659 million | $179 million | 73.0% | $497 million | $104 million | 78.9% |
Investment Income
Investment income for Molina Healthcare in Q3 2024 was $118 million, a 5% increase from $112 million in Q3 2023. For the nine months ended September 30, 2024, investment income totaled $341 million, compared to $280 million in the same period of 2023.
Operating Expenses
Molina's general and administrative expenses stood at $676 million in Q3 2024, compared to $608 million in Q3 2023. The G&A ratio improved to 6.5% in Q3 2024 from 7.1% in Q3 2023.
Cash Flow and Liquidity
For the nine months ended September 30, 2024, Molina reported:
- Net cash provided by operating activities: $868 million.
- Net cash used in investing activities: $483 million.
- Net cash used in financing activities: $414 million.
Balance Sheet Highlights
| Item | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Assets | $15,758 million | $14,892 million |
| Total Liabilities | $10,988 million | $10,677 million |
| Total Stockholders' Equity | $4,770 million | $4,215 million |
Tax Expenses
Income tax expense for Q3 2024 was $112 million, representing 25.7% of pretax income. For the nine months ended September 30, 2024, the total income tax expense was $315 million, or 25.3% of pretax income.
Regulatory Environment
The end of the Public Health Emergency (PHE) on May 11, 2023, has impacted several healthcare programs, including Medicaid eligibility redeterminations that resumed on April 1, 2023. Molina estimates a loss of approximately 50,000 members due to these redeterminations in Q3 2024.
How Molina Healthcare, Inc. (MOH) Makes Money
Revenue Streams
Molina Healthcare, Inc. generates its revenue primarily through three segments: Medicaid, Medicare, and Marketplace. As of Q3 2024, the following are the key revenue figures:
| Segment | Premium Revenue (Q3 2024) | Medical Margin (Q3 2024) | MCR (Q3 2024) |
|---|---|---|---|
| Medicaid | $7,668 million | $730 million | 90.5% |
| Medicare | $1,367 million | $142 million | 89.6% |
| Marketplace | $659 million | $179 million | 73.0% |
| Total | $9,694 million | $1,051 million | 89.2% |
Medicaid Segment
The Medicaid segment is the largest contributor to Molina's revenue, accounting for approximately 78.3% of total premium revenue in Q3 2024. This segment saw an increase of $957 million, or 14%, compared to Q3 2023, due to new contract wins and expansions in states like Iowa, Nebraska, and New Mexico. The medical care ratio (MCR) for this segment increased to 90.5%, indicating higher medical costs relative to premium revenue.
Medicare Segment
Molina's Medicare segment reported premium revenue of $1,367 million in Q3 2024, marking a significant increase of $335 million, or 32%, compared to the same quarter in 2023. This growth was driven by the Bright Health Medicare acquisition and organic membership growth. The MCR for Medicare improved to 89.6%, down 280 basis points from the prior year, reflecting better cost management and risk adjustment premiums.
Marketplace Segment
The Marketplace segment generated $659 million in premium revenue during Q3 2024, up $162 million from the previous year. Membership in this segment increased to 410,000, driven by strategic pricing and product offerings. The MCR for this segment was 73.0%, indicating effective cost management and operational improvements.
Financial Performance Overview
For the nine months ended September 30, 2024, Molina Healthcare reported the following consolidated results:
| Metric | 2024 | 2023 |
|---|---|---|
| Net Income | $928 million | $875 million |
| Net Income per Share (Diluted) | $15.97 | $15.08 |
| Operating Income | $1,327 million | $1,257 million |
| Investment Income | $341 million | $280 million |
Cost Management and Efficiency
Molina Healthcare has maintained a strong focus on cost management, reflected in its general and administrative (G&A) expense ratio of 6.5% in Q3 2024, down from 7.1% in Q3 2023. This reduction is attributed to operational efficiencies and fixed cost leverage as the company expands.
Membership Growth and Retention
As of September 30, 2024, Molina Healthcare served approximately 5.6 million members, an increase of 392,000 members, or 8%, year-over-year. This growth is attributed to new Medicaid contracts and acquisitions.
| Membership by Segment | September 30, 2024 | September 30, 2023 |
|---|---|---|
| Medicaid | 4,941,000 | 4,757,000 |
| Medicare | 247,000 | 173,000 |
| Marketplace | 410,000 | 276,000 |
| Total | 5,598,000 | 5,206,000 |
Investment Income
Investment income has also played a crucial role in Molina's financial performance, amounting to $341 million for the nine months ended September 30, 2024, compared to $280 million in the same period of 2023. This increase is primarily due to higher yields from the investment portfolio.
Conclusion of Financial Metrics
Molina Healthcare's effective management of its segments and strategic growth initiatives have positioned the company to generate robust revenue and maintain profitability. The overall increase in premium revenue and net income highlights the effectiveness of its business model in the competitive healthcare landscape.
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Article updated on 8 Nov 2024
Resources:
- Molina Healthcare, Inc. (MOH) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Molina Healthcare, Inc. (MOH)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Molina Healthcare, Inc. (MOH)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.