What Happened?
Shares of healthcare services company Agilon Health (NYSE: AGL) fell 4.4% in the afternoon session after the company was downgraded by analysts at Bernstein from “Outperform” to “Market Perform”. The firm also slashed its price target on the stock by 65% to $1.40 from $4.00. Analyst Lance Wilkes cited “worse-than-expected margin pressures” following a disappointing quarter where the company's medical margin was a negative $53 million. This was primarily driven by lower-than-expected risk adjustment revenue for 2024 and 2025. Bernstein expressed concerns about agilon's reduced capital, which increases its cost of capital, and noted cash flow uncertainty after the company withdrew its fiscal year 2025 guidance.
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What Is The Market Telling Us
agilon health’s shares are extremely volatile and have had 80 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 2 days ago when the stock gained 8.1% on the news that the stock extended its positive momentum as it bounced back from a significant dip. The rally follows a difficult period for the company, which saw its stock plunge over 50% after the CEO stepped down and full-year 2025 financial guidance was withdrawn on August 4. The move appears to have a technical component, as the stock gained for four consecutive days after.
agilon health is down 36.7% since the beginning of the year, and at $1.22 per share, it is trading 78.6% below its 52-week high of $5.68 from April 2025. Investors who bought $1,000 worth of agilon health’s shares at the IPO in April 2021 would now be looking at an investment worth $39.19.
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