GET DAILY SIGNALSElevance Health (ELV) Delivers Solid Q3 Earnings Beat and Raises 2026 Guidance
Key Takeaways
- Adjusted diluted earnings per share (EPS) came in at $6.99, well above the roughly $4.70 consensus estimate.
- Operating revenue reached $50.4 billion, up 0.7% year over year and ahead of the approximately $49.3 billion analyst forecast.
- Management raised full-year 2026 adjusted EPS guidance to at least $29, up from the prior outlook of at least $27.
- The benefit expense ratio improved 70 basis points to 90.6%, reflecting better performance in Medicare Advantage and individual Affordable Care Act (ACA) plans.
- Medical membership fell to about 44.9 million, down 487,000 from a year earlier, as growth in commercial fee-based plans partially offset Medicaid and Medicare declines.
Why These Results Matter Now
Elevance Health's third quarter results arrive at a pivotal moment for the managed-care sector. Investors have been closely watching how major insurers manage medical costs across their Medicaid, Medicare Advantage, and individual ACA books, as elevated care utilization and shifting rate environments have pressured margins across the industry. For Elevance Health, the report also serves as a test of its diversified model, which pairs its Health Benefits insurance operations with the Carelon services platform. A strong beat combined with raised guidance signals improving cost discipline and execution, while the continued decline in membership highlights the balancing act between profitability and enrollment growth that will shape the company's trajectory into 2027. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
The Quarter in Detail
For the third quarter ended September 30, 2026, Elevance Health reported adjusted diluted EPS of $6.99, far exceeding the consensus estimate of approximately $4.70. Operating revenue rose 0.7% year over year to $50.4 billion, topping the roughly $49.3 billion analysts expected. On a GAAP (Generally Accepted Accounting Principles) basis, net income increased to $1.34 billion, or $6.27 per diluted share, compared with $1.19 billion, or $5.32 per share, in the prior-year period.
The closely watched benefit expense ratio, which compares medical costs to premium revenue, improved 70 basis points to 90.6%. The company attributed the improvement to better performance in Medicare Advantage and individual ACA plans, as well as favorable Medicaid rate actions. The Health Benefits segment generated operating revenue of $43.4 billion, while the Carelon segment reported revenue of $19.3 billion, up 5%, with operating gain rising 17% to $0.9 billion.
Elevance Health raised its full-year 2026 adjusted EPS guidance to at least $29, and increased its operating cash flow outlook to at least $6.5 billion. The company also declared a fourth-quarter dividend of $1.72 per share.
How the Market Reacted
The market responded favorably to the results. Shares of Elevance Health rose following the announcement, with the stock trading higher in the session as investors digested the earnings beat, the improved benefit expense ratio, and the upwardly revised guidance. The magnitude of the adjusted EPS beat, driven in part by roughly $1.85 per share of net non-operating benefit related to investment income valuation adjustments, gave the print an especially strong headline. Sentiment was further supported by management's confidence in delivering at least 12% adjusted EPS growth in 2027 from a higher earnings baseline of at least $26.75. Still, the ongoing decline in medical membership remains a point of focus for investors weighing near-term margin gains against longer-term enrollment momentum.
Looking Ahead
Elevance Health enters the fourth quarter and 2027 with raised expectations and a clearer earnings path. Management now sees full-year 2026 adjusted EPS of at least $29 and reiterated confidence in at least 12% adjusted EPS growth in 2027, supported by margin improvement in Health Benefits, ongoing expansion of Carelon, and greater operating efficiency across the enterprise.
Several factors will shape whether the company can sustain this momentum. First, investors should watch Medicaid cost trends and rate alignment, which management views as stabilizing, with 2026 expected to mark the trough for Medicaid margins. Second, Medicare Advantage positioning for the 2027 annual enrollment period, including a focus on HMO (Health Maintenance Organization) plans and dual-eligible members, will be important for both margin and membership recovery. Third, the individual ACA business is expected to end the year with at least 1.2 million members, and sustained favorable claims development will be key to meeting the strengthened outlook.
Finally, the adjusted operating expense ratio rose 90 basis points to 11.3% as the company made targeted investments in member experience, medical cost management, and Carelon's value-based solutions. Whether those investments translate into durable efficiency gains and sustained membership growth will be central to the company's long-term earnings trajectory. From what I see, this is important because it shows a clear path forward if execution remains strong.
Integrating AI Tools Into My Workflow
When reviewing healthcare names like Elevance Health, I often turn to Tickeron’s AI Screener to quickly compare performance metrics and identify peers with similar patterns. It helps surface relevant data points without spending hours on manual analysis, which keeps my focus on the bigger picture for these earnings reports.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
ELV's RSI Indicator leaves overbought zone
The 10-day RSI Indicator for ELV moved out of overbought territory on October 23, 2026. This could be a sign that the stock is shifting from an upward trend to a downward trend. Traders may want to look at selling the stock or buying put options. Tickeron's A.I.dvisor looked at 28 instances where the indicator moved out of the overbought zone. In 20 of the 28 cases the stock moved lower in the days that followed. This puts the odds of a move down at 71%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for ELV turned negative on October 28, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 51 similar instances when the indicator turned negative. In 30 of the 51 cases the stock turned lower in the days that followed. This puts the odds of success at 59%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ELV declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 58%.
ELV broke above its upper Bollinger Band on October 09, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 39 of 64 cases where ELV's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 61%.
The Momentum Indicator moved above the 0 level on November 10, 2026. You may want to consider a long position or call options on ELV as a result. In 58 of 99 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 59%.
ELV moved above its 50-day moving average on October 06, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for ELV crossed bullishly above the 50-day moving average on October 13, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 9 of 15 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 60%.
Following a +4.98% 3-day Advance, the price is estimated to grow further. Considering data from situations where ELV advanced for three days, in 183 of 319 cases, the price rose further within the following month. The odds of a continued upward trend are 57%.
The Aroon Indicator entered an Uptrend today. In 137 of 251 cases where ELV Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 55%.
Fundamental Analysis (Ratings)
The Tickeron PE Growth Rating for this company is 9 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Price Growth Rating for this company is 34 (best 1 - 100 worst), indicating steady price growth. ELV’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of 64 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.057) is normal, around the industry mean (3.520). P/E Ratio (18.775) is within average values for comparable stocks, (126.353). ELV's Projected Growth (PEG Ratio) (1.291) is slightly higher than the industry average of (0.786). Dividend Yield (0.016) settles around the average of (0.009) among similar stocks. P/S Ratio (0.453) is also within normal values, averaging (0.569).
The Tickeron Profit vs. Risk Rating rating for this company is 78 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. ELV’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 82, placing this stock better than average.
The Tickeron SMR rating for this company is 99 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
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a provider of life, hospital and medical insurance plans
Industry ManagedHealthCare
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