- Company name
- Centene
- Sector
- Managed health care insurance
- About
- Centene Corporation is a US health insurer that runs government-sponsored and commercial managed care plans. At September 30, 2026, it served 25.7 million at-risk members: 11.9 million in Medicaid, 3.9 million in Marketplace and commercial plans, 0.95 million in Medicare and 8.9 million in Medicare prescription drug plans. Premium and service revenues were $45.1 billion in Q3 2026: $24.0 billion in Medicaid, $8.7 billion in commercial, $11.3 billion in Medicare and $1.1 billion in other. Marketplace membership fell to 3.4 million from 5.8 million a year earlier. Centene held cash, investments and restricted deposits of $39.9 billion, of which only $175 million was cash available for general corporate use. Sarah M. London is Chief Executive Officer. The pick is the common stock on the NYSE (CNC), in US dollars.
- Thesis
- The market prices Centene as a health insurer with very thin margins, where a small change in medical costs moves profit by a lot. In 2025, adjusted diluted earnings per share fell to $2.08, with a loss in Q4 2025. In 2026 profit is recovering: adjusted earnings per share were about $6.45 for the first nine months, and Centene raised its guidance floor for 2026 to more than $5.20, because the health benefits ratio (HBR, medical costs divided by premiums) improved. The HBR was 92.7% in Q3 2026, and Centene now expects 90.4% to 91.1% for the year. For the price to rise, the HBR must keep falling as Medicaid rates and Marketplace prices catch up with medical costs, and Centene must show 2027 profit above 2026. It must also keep cutting debt, which fell by $1.1 billion after June 30, 2026. The Q4 report and the 2027 outlook in February 2027 are the next tests. If margins keep improving, the gap can close within about two years.
- Risks
- Medical costs and rates. One point of HBR on about $175 billion of premium and service revenue is about $1.75 billion before tax. If medical costs rise faster than the rates that governments and buyers pay, profit falls fast.
Government programs. Most revenue comes from Medicaid, Medicare and Marketplace plans. Changes in federal subsidies, state rates or rules cut membership: Medicaid fell to 11.9 million members from 12.7 million, and Marketplace fell to 3.4 million from 5.8 million.
Risk adjustment. Marketplace revenue includes an estimate of risk adjustment transfers for the 2026 benefit year. If the estimate is too high, Centene must book a charge.
Debt. Total debt was $15.5 billion at September 30, 2026, about 41% of total capital, and the 2026 outlook for interest expense is $600 million to $620 million.
Medicare drug plans. The Inflation Reduction Act changed Part D from 2025, and Centene has 8.9 million members in stand-alone prescription drug plans. Further rule changes or higher drug costs would cut margins.
- Balance sheet
- At September 30, 2026, Centene had cash, investments and restricted deposits of $39.9 billion, with $175 million of cash available for general corporate use. Medical claims liabilities were $21.5 billion and days in claims payable were 48. Total debt was $15.5 billion, with no borrowings on its $4.0 billion revolving credit facility, and Centene repurchased the remaining $569 million of its 2027 notes in October 2026. Centene stockholders' equity was $22,207 million, against $19,953 million at December 31, 2025, which is about $44.86 per share on 495,068 thousand shares at October 23, 2026. Total assets were $79,280 million. All amounts are in US dollars.
As of Sep 30, 2026.
- Checkpoints
- Feb 5, 2027 (estimate): Q4 2026 results and 2027 outlook. Pending. Watch: Full-year 2026 adjusted diluted earnings per share above $5.20 and a 2027 outlook above that figure passes; a lower 2027 outlook fails.
Oct 2027 (estimate): Q3 2027 results: health benefits ratio. Pending. Watch: A consolidated HBR below 92.7% for the quarter passes; a higher ratio fails.
- Recent events
- Oct 27, 2026: Centene reported Q3 2026 results. Total revenues were $50.6 billion, the HBR was 92.7%, GAAP loss per diluted share was $0.14 and adjusted earnings per diluted share were $0.58. It raised its 2026 guidance floors to GAAP diluted earnings per share above $3.46 and adjusted above $5.20, and it cut its HBR range to 90.4% to 91.1%.
Oct 27, 2026: Centene said that it repurchased $558 million of its 2027 and 2028 senior notes in Q3 2026 and that in October it raised its debt repurchase program by $2.0 billion and bought the remaining $569 million of its 2027 notes. Total debt was $15.5 billion at September 30, 2026.
Feb 6, 2026: Centene reported 2025 results and gave 2026 guidance. Adjusted diluted earnings per share for 2025 were $2.08, with a loss of $1.19 in Q4, and the 2026 guidance was adjusted earnings per share of more than $3.00.