On February 5, 2025, Molina Healthcare Inc (MOH, Financial) released its 8-K filing detailing the financial results for the fourth quarter and full year of 2024. Molina Healthcare Inc, a provider of healthcare plans focused on Medicaid-related solutions for low-income families and individuals, operates through its subsidiaries as a health maintenance organization (HMO). The company is segmented into Medicaid, Medicare, Marketplace, and Others, with the majority of its revenue generated from the Medicaid segment.

Performance Overview and Challenges

Molina Healthcare Inc reported a GAAP earnings per diluted share of $4.44 for the fourth quarter of 2024, falling short of the analyst estimate of $5.53. The adjusted earnings per diluted share were $5.05. For the full year, GAAP earnings per diluted share were $20.42, with adjusted earnings at $22.65, both reflecting year-over-year growth. Despite these achievements, the company faced challenges such as higher-than-expected utilization rates and the impact of Medicaid redeterminations, which affected the Medical Care Ratio (MCR).

Financial Achievements and Industry Importance

Molina Healthcare Inc's premium revenue for 2024 was approximately $38.6 billion, marking a 19% increase from the previous year. This growth was driven by new contract wins, acquisitions, and expansion within existing markets. Such financial achievements are crucial for companies in the healthcare plans industry, as they reflect the ability to manage costs effectively while expanding service offerings.

Income Statement and Key Metrics

The company's total revenue for the fourth quarter was $10.499 billion, compared to $9.048 billion in the same period of 2023. For the full year, total revenue reached $40.650 billion, up from $34.072 billion in 2023. The Medical Care Ratio (MCR) for 2024 was 89.1%, indicating a focus on managing medical costs. The General and Administrative (G&A) expense ratio was 6.7%, showcasing disciplined cost management.

Balance Sheet and Cash Flow Insights

As of December 31, 2024, Molina Healthcare Inc reported cash and investments at the parent company totaling $445 million, down from $742 million at the end of 2023. The company repurchased approximately 1.7 million shares for $500 million in Q4 2024. Operating cash flow for the year was $644 million, a decrease from $1.662 billion in 2023, primarily due to timing differences in government receivables and payables.

Analysis and Future Outlook

Molina Healthcare Inc's performance in 2024 highlights its ability to grow revenue and manage costs effectively, despite challenges such as increased utilization and Medicaid redeterminations. The company's guidance for 2025 anticipates premium revenue of approximately $42 billion and adjusted earnings per share of at least $24.50, reflecting continued growth in its legacy footprint and new contract wins. This outlook suggests a positive trajectory for Molina Healthcare Inc as it navigates the complexities of the healthcare plans industry.

I am very pleased our 2024 revenue growth exceeded our long-term targets and we produced consolidated pre-tax margins within our long-term target range," said Joseph Zubretsky, President and Chief Executive Officer.

Explore the complete 8-K earnings release (here) from Molina Healthcare Inc for further details.