Molina Healthcare heads into its May 6 Q1 report having nearly doubled off its February lows — a move that now sits well ahead of where analysts believe fair value lies.
The most striking element of the setup is the divergence between price and analyst targets. The stock closed Friday at $192.70, yet the consensus mean target is $173.88 — meaning MOH has already traded through every published price target on the Street. The P/E has expanded by roughly 8.9 points over the past month alone to almost 30.5x, a re-rating that reflects the sector-wide relief rally following a run of better-than-feared managed care results. Peer CNC jumped nearly 28% on the week, and ELV and HUM each added roughly 8-9%. MOH has been swept up in that tide, but it has run harder than most.
Options positioning has actually turned less defensive into the print — a notable contrast with the price surge. The put/call ratio is running at 1.20, almost two standard deviations its 20-day average of 1.37. That's unusually low protection relative to recent norms, suggesting options traders have been unwinding hedges rather than adding new ones as the stock rallied. The PCR touched 1.65 earlier in the year and has compressed steadily since. Short interest has moved in the same direction: the borrow pool has eased around 14% over the past week to roughly 5.9% of float. Availability is wide and cost to borrow is negligible at 0.42%, so there is no meaningful squeeze dynamic at play. The ORTEX short score has also drifted lower, from 43 in mid-April to 39.8 — not the profile of a stock bears are pressing.
Analysts are divided, but the recent direction is cautious. Several firms raised targets last week — Wells Fargo, Truist, UBS, and Barclays all lifted numbers — yet every one of those upgrades left the new target below the current market price. Morgan Stanley raised to $146, and Barclays, the sole underweight, moved only to $161. The bull case centres on Molina's D-SNP book generating solid per-member economics and the underlying Medicaid franchise remaining profitable despite the exit of the MAPD segment. The bear case is harder to dismiss heading into the print: Medicaid membership is guided to fall 2.6%, Molina's MLR assumptions for the marketplace business look optimistic in a still-elevated medical cost environment, and the 2026 guidance itself is described by analysts as difficult to underwrite. Past results show the stock has moved aggressively on earnings — a 15% jump and a 30% five-day rally after the most recent comparable print — so the market has rewarded positive surprises generously. Whether the current price already embeds too much of that optimism is the question the Q1 numbers will answer.
The Wednesday print is therefore less a test of whether Molina can grow and more a test of whether its medical loss ratio and membership trajectory justify a stock that has run far beyond where the analysts who cover it think it belongs.
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