Molina Healthcare (MOH) Q4 2023 earnings summary

Executive summary

• Served 5.0M members at year-end 2023; FY premium revenue rose 5% YoY to $32.5B, while adjusted diluted EPS increased 17% to $20.88.

• FY GAAP diluted EPS reached $18.77, up 39% YoY; Q4 GAAP and adjusted diluted EPS were $3.70 and $4.38, respectively.

• 2024 guidance calls for $38B premium revenue and adjusted diluted EPS of at least $23.50, supported by embedded earnings and organic growth.

Financial highlights

• Q4 2023 premium revenue was $8.362B and total revenue was $9.048B; GAAP net income was $216M and adjusted net income was $255M.

• FY 2023 total revenue was $34.072B, up from $31.974B in 2022; GAAP net income was $1.091B versus $792M, and adjusted net income was $1.213B versus $1.048B.

• FY operating income was $1.573B, compared with $1.173B in 2022; FY medical care costs were $28.669B and G&A expense was $2.462B.

Outlook and guidance

• FY 2024 premium revenue guidance is $38.0B, up ~17% from FY 2023; total revenue guidance is $39.6B.

• FY 2024 adjusted diluted EPS guidance is at least $23.50, representing ~13% growth; GAAP diluted EPS is expected to exceed $22.00.

• Guidance includes GAAP net income of $1.278B and adjusted net income of $1.366B; diluted weighted-average shares are assumed at 58.1M.

• Year-end 2024 membership guidance is 5.7M total: 5.1M Medicaid, 270K Medicare and 370K Marketplace members.

• Guidance ratios include consolidated MCR of 88.2%, GAAP and adjusted G&A ratios of 7.1% and 7.0%, and adjusted after-tax margin of 3.4%.