BofA Sees Centene EPS Soaring by 2029 on Medicaid Margin Rebound

BofA Securities released a report earlier this week projecting that Centene Corporation (CNC) could see its earnings per share (EPS) multiply several times by 2029, driven primarily by a rebound in Medicaid margins and improved managed care profitability after recent pressures.

Recommendation Change

The report did not specify a rating change but significantly raised future EPS expectations. No new price target was provided, but the report argues that 2026 guidance reflects only a fraction of Centene's perceived potential.

Analyst Rationale

BofA analysts believe Medicaid margins will recover based on historical patterns, suggesting current margin pressures are temporary. Improved managed care profitability will further boost earnings.

Context

The projections come after a period of pressure on health insurers due to rising medical costs and utilization rates. Centene's stock has declined 15% over the past year but is up 8% year-to-date in 2026. Other analysts have mixed views, with some cautioning that the projections may be overly optimistic.

What to Make of It

While BofA's outlook is bullish, investors should consider risks related to Medicaid policy changes and regulatory shifts. Monitoring upcoming quarterly results will be key to assessing margin improvement.