What Happened?

Shares of health coverage company Centene (NYSE: CNC) jumped 5.8% in the morning session after Baird raised its price target on the stock to $36 from $28, though the firm maintained its Neutral rating. The move from the investment firm suggested an improved outlook on the company's valuation, even as it stopped short of a full recommendation to buy the shares. Adding to the positive sentiment, the Hotchkis & Wiley Mid-Cap Value Fund noted in a recent investor letter that it viewed Centene as an attractive investment. The fund pointed to the company's position as a clear market leader where scale provides a significant competitive edge.

Is now the time to buy Centene? Access our full analysis report here.

What Is The Market Telling Us

Centene’s shares are very volatile and have had 20 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 17 days ago when the stock gained 7.3% on the news that a Politico report revealed that the White House plans to pitch a two-year extension of Obamacare subsidies. The proposal would extend subsidies set to expire at the end of the year, with new eligibility limits for individuals with incomes up to 700% of the federal poverty line. These subsidies, a key part of the Affordable Care Act (ACA), help lower the cost of health insurance for consumers, making them crucial for insurers focused on the ACA marketplace. An extension would likely support sustained enrollment, securing a key revenue stream for these companies.

Centene is down 32.3% since the beginning of the year, and at $40.97 per share, it is trading 37.8% below its 52-week high of $65.89 from January 2025. Investors who bought $1,000 worth of Centene’s shares 5 years ago would now be looking at an investment worth $674.77.

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