After investors fearfully sold off health insurer stocks, it might be time to be bullish on them. These firms will unveil significant changes to their prior authorization requests. That would simplify the process and increase customer satisfaction.
The biggest health insurers will have a common standard that starts in 2027. By supporting electronic requests for prior authorizations, plan holders will have fewer uncertainties.
Insurance firms that investors should watch include Molina Healthcare (MOH), Elevance Health (ELV), UnitedHealth (UNH), CVS Health (CVS), Humana (HUM), and Cigna (CI).
Among these picks, CVS stock has attractive valuations, while this stock and Cigna have strong profitability. Analysts are bullish on CVS’s prospects. Many of them raised their EPS estimates in the last 90 days.
UnitedHealth stock trades at a premium and offers weakening growth, but is still profitable. The stock momentum remains weak. This suggests that investors need to wait for a sustained uptrend before turning permanently bullish on UNH stock.
Molina and Centene (CNC) trade at attractive valuations. Once the industry helps the healthcare industry save on drug costs, these two firms should rebound sooner.
The industry currently has a serious problem with denying its plan holders. It will need to reevaluate its business model. Once it minimizes claim denial rates for those that are legitimate, health insurer stocks will become appealing to investors.
