Elevance Health shares outpace S&P 500 as analysts hold cautious optimism
The US health insurer has lifted its full-year profit outlook after strong second-quarter results, though Wall Street expects a year-on-year dip in earnings for 2026.
Elevance Health shares have delivered a strong performance over the past year, outperforming the broader market despite a projected decline in earnings for the current fiscal year. The Indianapolis-based company, which operates under the Anthem Blue Cross and Blue Shield, Wellpoint, and Carelon brands, has seen its stock rise 27.6% over the past 52 weeks. This gain compares favourably with the 18.3% increase recorded by the S&P 500 index over the same period.
The outperformance extends to the year-to-date period, where Elevance Health shares have climbed 15.3%, surpassing the S&P 500’s 11.8% rise. The stock has also slightly outpaced the State Street Health Care Select Sector SPDR ETF, which returned 26.4% over the past 52 weeks. With a market capitalisation of $86.9 billion, the company remains a significant player in the US health benefits sector.
Following the release of its second-quarter 2026 results on 15 July, Elevance Health reported operating revenue of $49.8 billion and adjusted earnings per share of $7.45. The company subsequently raised its fiscal 2026 adjusted EPS guidance to at least $27 and increased its operating cash flow guidance to a minimum of $6 billion. This revised outlook was supported by a 6% growth in Carelon revenue, which reached $19.2 billion in the quarter, as well as management’s confidence in returning to at least 12% adjusted EPS growth in 2027.
Analysts currently expect Elevance Health’s adjusted EPS to decline 10.3% year-on-year to $27.18 for the fiscal year ending in December 2026. However, the company’s track record of beating consensus estimates in each of the last four quarters has provided a buffer against this expected slowdown. Among the 22 analysts covering the stock, the consensus rating remains a "Moderate Buy," a configuration that has remained unchanged over the past three months.
This consensus is based on 14 "Strong Buy" ratings and eight "Holds." On 17 July, Leerink raised its price target for Elevance Health to $395 while maintaining a "Market Perform" rating. The mean price target across the street stands at $445.71, representing an 11.6% premium to the stock’s current price levels.
The most optimistic view on the stock comes from the Street-high price target of $492, which suggests a potential upside of 23.2%. These figures indicate that while investors are aware of the near-term earnings headwinds, they remain confident in the long-term trajectory of the health insurer.
