Elevance Health (NYSE:ELV) Maintains "Buy" Rating Despite Challenges

• Cowen & Co. maintains a "Buy" rating for Elevance Health (NYSE:ELV), adjusting the price target from $589 to $484.
• The company reported a disappointing third-quarter result for 2024, with an increase in the benefit expense ratio, leading to reduced earnings expectations for the full year.
• Despite these challenges, Elevance Health is considered favorably valued, with a stable revenue stream from government plans and a strong market presence.

Elevance Health (NYSE:ELV) is a prominent player in the healthcare sector, providing a range of health insurance products and services. The company competes with other major insurers like UnitedHealth Group and Cigna. On October 21, 2024, Cowen & Co. maintained its "Buy" rating for Elevance Health, with the stock priced at $430.77. However, TD Cowen adjusted its price target from $589 to $484.

Elevance Health's third-quarter results for 2024 were disappointing, with a notable increase in the benefit expense ratio. This ratio measures the cost of benefits provided to policyholders relative to the premiums earned. A higher ratio indicates increased costs, which can impact profitability. Consequently, the company reduced its earnings expectations for the full year.

Despite these challenges, Elevance Health's stock is considered favorably valued. Analysts have conducted a detailed analysis of the company's exposure to government plans, which are a significant part of its business. These plans are generally profitable, providing a stable revenue stream for the company. Even with conservative growth assumptions, the stock remains attractive to investors.

The current price of ELV is $430.77, reflecting a decrease of 3.06% with a change of -$13.58. Today, the stock has fluctuated between a low of $426.46 and a high of $442.78. Over the past year, ELV has reached a high of $567.26 and a low of $397.98. The company's market capitalization stands at approximately $99.91 billion, indicating its significant presence in the market.

The trading volume for ELV on the NYSE is 3,318,298 shares, suggesting active investor interest. Despite the recent challenges, the maintained "Buy" rating by Cowen & Co. indicates confidence in Elevance Health's long-term potential. Investors may find the current valuation appealing, especially given the company's strong position in the healthcare industry.