Why Shares of Elevance Health (ELV) Are Rising Today

Recent Developments for Elevance Health

Elevance Health (NYSE: EVH), a major player in the health insurance sector, saw its stock price climb by 3% during morning trading after Wolfe Research upgraded its rating from Peerperform to Outperform and set a new price target of $425.

Wolfe Research highlighted a promising outlook for Elevance Health, suggesting that its 2026 projections likely represent a low point for the company, which could help improve investor sentiment. The firm also pointed to growth opportunities in areas such as Medicare Advantage and Medicaid. Further boosting confidence, Wells Fargo increased its price target for Elevance Health to $424 from $403, while maintaining an 'Overweight' recommendation.

Following the initial surge, the stock settled at $377.39, reflecting a 2.9% increase from the previous closing price.

Market Reaction and Stock Performance

Historically, Elevance Health’s stock has shown limited volatility, with only nine instances of price swings greater than 5% over the past year. Today’s movement suggests that investors view the latest news as significant, though it may not fundamentally alter the market’s overall perspective on the company.

The most notable price drop in the last year occurred six months ago, when shares fell by 11.5% after the company released its second-quarter results and reduced its full-year profit forecast, citing increased medical expenses.

During that quarter, Elevance Health reported adjusted earnings of $8.84 per share, falling short of Wall Street’s estimate of $9.16 per share. While revenue reached $49.42 billion—surpassing expectations—net income declined to $1.74 billion from $2.30 billion a year earlier. The main issue for shareholders was the sharp downward revision of the company’s 2025 earnings outlook, with management now projecting adjusted earnings per share of about $30.00, down from the previous range of $34.15 to $34.85. This adjustment was attributed to rising medical costs in Medicaid and Affordable Care Act (ACA) plans, as reflected in the benefit expense ratio increasing to 88.9%, signaling that healthcare costs are outpacing premium growth. This trend has also impacted other health insurers facing similar challenges.

Stock Trends and Investment Perspective

Since the start of the year, Elevance Health’s share price has risen by 6.5%. However, at $377.39 per share, it remains 16.6% below its 52-week peak of $452.69 reached in April 2025. For context, an investor who put $1,000 into Elevance Health five years ago would now have approximately $1,120.

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