Centene Corporation has lifted its full-year 2026 earnings guidance after a forecast-beating first quarter, offering the clearest sign yet that the managed care insurer's recovery from a bruising 2025 is gaining traction.
The company now expects 2026 adjusted diluted earnings per share of more than $3.40, up from the more than $3.00 floor it set in February.
Premium and service revenue guidance was raised by $1 billion to between $171 billion and $175 billion, driven by Medicaid. Investment and other income expectations were nudged up by $50 million to $1.45 billion.
For the period ended March 31, total revenues came in at $49.94 billion. Premium and service revenues rose 5% to $44.66 billion from $42.5 billion a year earlier, lifted by premium yield and prescription drug plan (PDP) growth, state-directed payments, and Medicaid rate increases tied to medical trend. Softer Marketplace and Medicaid enrollment took some shine off the top line.
GAAP diluted earnings per share were $3.11. Adjusted diluted EPS came in at $3.37, well clear of the $2.13 consensus reported by Investing.com on revenue forecasts of $47.58 billion. Cash flow from operations was $4.37 billion.
The health benefits ratio (HBR) edged down to 87.3% from 87.5%, with Medicaid HBR off 50 basis points on rate and revenue gains, tighter medical cost management, and moderate flu activity.
The consolidated figure was also helped by the absence of a 2026 premium deficiency reserve for Medicare Advantage, which had weighed on the prior-year quarter.
The SG&A expense ratio fell to 7.6% from 7.9%. The effective tax rate rose to 26.7% from 24.7%, while the adjusted rate was 26.5%.
Total at-risk membership slipped to 26.27 million from 27.94 million. Marketplace enrollment fell sharply to 3.58 million from 5.63 million. PDP membership climbed to 8.78 million from 7.87 million.
The Q1 print follows a torrid 2025, when Centene reported a full-year diluted loss of $13.53 per share after a $6.7 billion goodwill impairment booked in the third quarter. Management had previously tied the writedown to market conditions in July 2025, including the One Big Beautiful Bill Act and its sweeping Medicaid cuts,564641 alongside a slide in Centene's share price.
Chief financial officer Drew Asher told analysts at the time that the charge wiped out roughly 38% of the company's goodwill, though it had no impact on cash or operations.
The numbers land in a strong managed care reporting season. UnitedHealth Group posted first-quarter revenue of $111.7 billion, raised its full-year adjusted EPS guidance to more than $18.25, and brought its medical care ratio down to 83.9%.
Molina Healthcare beat with adjusted EPS of $2.35, though it has called 2026 a "trough year" for Medicaid margins. A 5.06% average Medicare Advantage rate increase finalized by CMS for 2026 is offering the sector a broad tailwind.
Chief executive Sarah London said the results "position us to increase our full year 2026 adjusted diluted EPS guidance."
