Agilon Health loses almost quarter of market value in a day after earnings

Quotes on Agilon Health, which provides healthcare services for seniors through primary-care physicians in the U.S., plummeted 24% yesterday, May 7, after the company released its first-quarter financials. While both revenue and EBITDA topped Wall Street expectations, Agilon shed customers and its growth is slowing, as StockStory reported.

Yesterday, Agilon plummeted 24% on the New York Stock Exchange to $3.39 per share. Earlier in the day, the company released its first-quarter financial results, posting declines across all key metrics. Revenue dropped 4% year over year to $1.53 billion, and adjusted EBITDA fell 16% to $21 million. Still, the results beat Wall Street expectations, reports StockStory.

What alarmed investors was a drop in the number of Medicare Advantage members on the company’s platform — down 6% to 491,000. Medicare Advantage is a U.S. federal health insurance program for people aged 65 and older that includes outpatient care, hospitalization, and prescription drug coverage. The shrinking member count suggests that Agilon’s growth “is clearly cooling,” StockStory notes.

The company’s pessimistic scenario for 2025 sees Medicare Advantage membership dropping further to 490,000. In its optimistic scenario, it could rise 6% to 520,000.

Since the start of the year, Agilon is up more than 78%. However, as StockStory points out, it is highly volatile and has had 78 swings greater than 5% over the last year. Two of those swings occurred just last month: On April 8, the stock jumped 26% after the investment firm Bernstein upgraded its recommendation from “hold” to “buy” and its target price by 158% to $8.50 per share; on April 17, Agilon plunged almost 27%, despite no news from the company that day.

According to MarketWatch, 14 Wall Street analysts rate Agilon a “hold,” four a “buy,” and two a “sell.” Their average target price of $4.48 per share is about 32% above current quotes.