Barclays raised targets on UnitedHealth and Elevance, saying Medicare remains the most stable business line, Medicaid the most uncertain, and Affordable Care Act exchanges are improving both fundamentally and from a policy standpoint.
Mizuho Securities raised price targets on several large U.S. health insurers following the release of the latest Medicare Advantage star ratings, noting improved visibility into earnings.
Analyst Ann Hynes raised her target on CVS Health to $88 from $76, UnitedHealth to $430 from $300, Elevance Health to $420 from $342 and Humana to $345 from $300 and maintained an ‘Outperform’ rating on all four stocks. The firm also lifted Centene’s target to $40 from $28 with a ‘Neutral’ rating.
Hynes said the target changes were driven by a broader rotation into the healthcare sector after the U.S. government released its 2026 quality ratings for Medicare Advantage and prescription drug plans, which help determine bonus payments to insurers.
Barclays also raised its price targets in the group, lifting UnitedHealth’s to $386 from $352 and Elevance Health’s to $395 from $373, both with Overweight ratings. The firm said Medicare remains the most stable business line, Medicaid the most uncertain, and Affordable Care Act exchanges are improving both “fundamentally and from a policy perspective.”
CVS Health’s Aetna unit led with over 81% of members in top-rated programs, followed by UnitedHealth at 78%, Elevance at 55%, and Humana at 20%, according to federal data and company disclosures.
In all, 64% of Medicare Advantage members with drug coverage are signed up for plans that get four or five stars, Oppenheimer said. The Centers for Medicare & Medicaid Services rates plans on metrics including patient satisfaction, and performance on cancer screenings and management of chronic conditions, among others, according to a Reuters report.
Four and five-star plans receive bigger government payments that could add up to billions of dollars and have a financial impact in 2027, Oppenheimer said. The research firm added that results broadly matched expectations following company pre-announcements.
Elevance showed one of the largest year-over-year gains, with 55% of its membership now in plans rated four stars or higher, up from 40% a year ago, while CVS said 63% of Aetna members are in 4.5-star plans. UnitedHealth said 40% of its members are in 4.5-star plans, and Humana reported 1.2 million members in highly rated offerings.
Centene’s Wellcare CEO Michael Carson said the company was encouraged by progress in its star ratings.
On Stocktwits, retail sentiment was ‘bullish’ for CVS Health amid ‘normal’ message volume, while sentiment for UnitedHealth, Elevance Health, Humana, and Centene was ‘bearish’ with ‘low’ message volume.
So far this year, CVS Health shares are up 77%, while Humana has gained 16%. In contrast, UnitedHealth is down 26%, Elevance Health has slipped 2%, and Centene has dropped 38%.
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