Reassessing Molina Healthcare (MOH) Valuation as Legal Probe Puts 2025 Guidance and Cost Assumptions in Focus

Grabar Law Office has launched an investigation into Molina Healthcare (MOH), questioning whether management adequately disclosed rising medical cost trends and a mismatch between premiums and underlying costs, which has put the company’s 2025 financial guidance under sharper investor scrutiny. See our latest analysis for Molina Healthcare. The investigation is landing after a volatile stretch, with Molina’s share price at $163.68 following a strong 1 month share price return, but a steep year to date share price decline and heavy multi year total shareholder return losses. This suggests momentum is fragile and sentiment is highly sensitive to guidance risks. If this probe has you reassessing managed care risk, it could be a useful moment to compare Molina against other healthcare stocks that may offer different growth and risk profiles. With valuations screening cheap on some metrics but guidance risk hanging over 2025, is Molina an unloved value opportunity for contrarian investors, or is the market already correctly pricing in weaker growth ahead? Most Popular Narrative Narrative: 3.7% Undervalued Against Molina Healthcare’s last close of $163.68, the most followed narrative points to a fair value of $170, hinting at modest upside built on specific growth and margin assumptions. Molina's successful track record of winning RFPs, including new contracts in Nevada and Illinois, is expected to drive significant revenue growth, with projected incremental annual premium revenue of approximately $800 million. This should positively impact revenue and EPS growth. Read the complete narrative. Curious how steady revenue expansion, subtle margin shifts and shrinking share count combine into that fair value math? The narrative leans on compounding effects across all three. Want to see how those moving parts are stitched together into a long term earnings path and valuation multiple that underpins $170? Read on to unpack the full set of assumptions. Result: Fair Value of $170 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, persistent Medicaid funding uncertainty and higher than expected medical cost inflation could quickly erode those margin assumptions and undermine the $170 fair value case. Find out about the key risks to this Molina Healthcare narrative. Build Your Own Molina Healthcare Narrative If you see the story differently, or want to stress test the numbers yourself, you can build a custom Molina thesis in minutes using Do it your way. A great starting point for your Molina Healthcare research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision. Looking for more investment ideas? Do not stop at one opportunity. Use the Simply Wall St Screener to quickly surface fresh, data backed ideas that could sharpen your next investing move. Capture potential compounding by scanning these 900 undervalued stocks based on cash flows where market pessimism may have pushed quality businesses below their intrinsic worth. Explore structural shifts in technology by checking out these 24 AI penny stocks that are building products and revenue streams around artificial intelligence. Review these 10 dividend stocks with yields > 3% to find companies that combine meaningful yields with the fundamentals to support regular payouts. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.Mobile Infrastructure for Defense and DisasterThe next wave in robotics isn't humanoid. Its fully autonomous towers delivering 5G, ISR, and radar in under 30 minutes, anywhere.Get the investor briefing before the next round of contractsSponsored On Behalf of CiTech