Michael Burry’s Top 10 Stock Picks Heading into 2025

3) Molina Healthcare, Inc. (NYSE:MOH)

Scion Asset Management’s Stake Value: $7,292,769

Number of Hedge Fund Holders: 45

Molina Healthcare, Inc. (NYSE:MOH) operates as a managed care organization. It arranges for the delivery of healthcare services to persons who are eligible for healthcare programs for low-income families and individuals.

Molina Healthcare, Inc. (NYSE:MOH)’s strategic focus on Medicaid, along with its active mergers and acquisitions (M&A) strategy, places it well in the healthcare market. Wall Street remains optimistic about the company’s acquisition of ConnectiCare. The acquisition reflects a strong strategic fit for the company, adding an established government business, a recognized brand, and a statewide provider network. This move is expected to add $1.00 per share to the new store-embedded earnings. It should also enhance the company’s financial performance and exhibit its commitment to growth through targeted acquisitions.

Molina Healthcare, Inc. (NYSE:MOH) has successfully extended its Medicaid contracts in critical states like Virginia and Florida. This ensures continued revenue streams. The success in contract renewals demonstrates robust operational capabilities and a healthy competitive position in these markets. Molina Healthcare, Inc. (NYSE:MOH)’s effective medical management practices, primarily in managing re-joiners, and favorable geographic diversification should act as critical tailwinds.

The company’s aggressive growth strategy might enable Molina Healthcare, Inc. (NYSE:MOH) to expand its market presence, diversify revenue streams, and achieve economies of scale. Analysts at Wells Fargo & Company upped their price objective on the company’s shares from $315.00 to $360.00, giving an “Equal-weight” rating on 5″ August.

Fidelity Investments, an investment management company, released its second quarter 2024 investor letter. Here is what the fund said:

“On a stock-specific basis, a larger-than-benchmark stake in Molina Healthcare, Inc. (NYSE:MOH) (-28%), a California-headquartered managed care firm, was the biggest relative detractor. The past year has been a difficult one for the managed care industry, due to rising medical costs and government reimbursements that have not kept pace. The past three months, Molina’s stock was dragged down by negative sentiment for the segment, even though its latest earnings report, in April, was better than expected.”