Anthem tops quarterly expectations, raises 2019 forecast

Indianapolis-based Anthem Inc. beat Wall Street's first-quarter expectations and raised its 2019 forecast, helped by a growth spurt in one of the Blue Cross-Blue Shield insurer's more profitable lines of coverage.

The nation's second largest insurer said Wednesday that enrollment in its fully-insured coverage jumped more than 6%, to 15.3 million, compared to enrollment in last year's first quarter. That helped push the company's total membership past 40 million people.

Fully insured coverage includes plans sold to small businesses, which are generally more profitable for insurers than coverage that larger employers buy in which they pay the claims and leave the insurer to administer the plan.

The insurer's "meaningful" growth in fully insured coverage helps it live up to its promise of market share improvement, SVB Leerink analyst Ana Gupte said in a research note.

Anthem runs insurance plans in several states, including big markets like California and New York. The insurer also saw growth in government-funded Medicaid and Medicare coverage in the first quarter.

Overall, the insurer's profit rose 18%, to $1.55 billion, or $5.91 per share, in the period when compared with the first quarter of 2018. Earnings adjusted for one-time gains and costs came to $6.03 per share.

Operating revenue, which excludes investment income, climbed 9%, to $24.39 billion.

Analysts expected, on average, adjusted earnings of $5.86 per share on $24.25 billion in operating revenue, according to Zacks Investment Research.

Anthem also said Wednesday that it now expects adjusted earnings this year to exceed $19.20 per share, up from a forecast it made in January for better than $19 per share.

Analysts forecast, on average, earnings of $19.17 per share for 2019, according to FactSet.

Anthem stock rose initially Wednesday morning before retreating by $2.11, to $248.53 per share.