Magellan Health (MGLN) Misses Q1 EPS by 15c, Revenues Beat; Affirms FY19 EPS Mid-Point Guidance Above Consensus, Lowers FY19 Revenue Views Below Consensus

Magellan Health (NASDAQ: MGLN) reported Q1 EPS of $0.40, $0.15 worse than the analyst estimate of $0.55. Revenue for the quarter came in at $1.8 billion versus the consensus estimate of $1.74 billion.

For First Quarter:

• Net revenue decreased 3.6 percent over the first quarter of 2018 to $1.7 billion.
• Net income decreased 96.2 percent over the first quarter of 2018 to $0.4 million.
• Segment profit decreased 18 percent over the first quarter of 2018 to $45.6 million.
• Adjusted net income decreased 54 percent over the first quarter of 2018 to $9.6 million.
• Unrestricted cash and investments were $194.9 million as of March 31, 2019. Approximately $88.4 million of the unrestricted cash and investments at March 31, 2019 is related to excess capital and undistributed earnings held at regulated entities.
• The Company is affirming its full year 2019 earnings guidance, but modestly lowering revenue guidance to a range of $7.0 to $7.2 billion.

“Overall, our Healthcare results were solid, and our Pharmacy results for the quarter were impacted by some unfavorable out-of-period and timing items related to network costs,” said Barry M. Smith, chairman and chief executive officer of Magellan Health. “I’m pleased with the actions we completed during the first quarter in 2019 which represent significant progress towards achieving our margin improvement plan. We’re seeing the benefits of the strong leadership we’ve put in place over the last six months, particularly in our MCC segment. We have a clear path to achieve our full year earnings guidance, and I’m confident in the team and our ability to execute.”

GUIDANCE:

Magellan Health sees FY2019 EPS of $3.70-$4.69, versus the consensus of $3.92. Magellan Health sees FY2019 revenue of $7-7.2 billion, versus the consensus of $7.22 billion.

For earnings history and earnings-related data on Magellan Health (MGLN) click here.

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