We came across a bullish thesis on Molina Healthcare, Inc. (MOH) on Long-Term Pick’s Substack by Dan. In this article, we will summarize the bulls’ thesis on MOH. Molina Healthcare, Inc. (MOH)’s share was trading at $304.28 as of Jan 29th. MOH’s trailing and forward P/E were 15.48 and 11.71 respectively according to Yahoo Finance.
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Molina Healthcare (MOH) presents a compelling investment opportunity as the company is positioned for significant growth, particularly within the low-income populations it serves. One of Molina’s key recent developments is the award of a new Medicaid managed care contract in Florida, which began in January 2025. This contract, which will run until 2030, expands Molina’s footprint by covering approximately 90,000 Medicaid beneficiaries in Miami-Dade and Monroe counties, strengthening its presence in the state’s Medicaid market.
Additionally, Molina received a notice of intent to award a contract from the Wisconsin Department of Health Services, slated to start in January 2025. This two-year contract, with options for extensions, further enhances Molina’s service offerings in the region. The company has also secured significant contracts in Michigan and Idaho to serve dual-eligible populations—those enrolled in both Medicare and Medicaid. These contracts, set to begin in 2026, represent a substantial membership growth opportunity, positioning Molina to capitalize on a rapidly growing segment.
Molina’s commitment to improving healthcare quality is evident in its quality improvement initiative, launched in collaboration with the California Medical Association’s Physician Services Organization. This program aims to enhance Medi-Cal healthcare in the Inland Empire over the next two years by providing physicians with valuable resources and support. Furthermore, Molina completed a $750 million senior notes offering, with a 6.25% interest rate, to fund debt repayment and capital expenditures, strengthening its financial position.
Despite these positive developments, Molina’s expanding reach and strategic contract wins are not yet fully reflected in its valuation. With significant growth potential in the Medicaid and dual-eligible markets, and a continued focus on healthcare quality, Molina Healthcare offers substantial upside for long-term investors. The company’s strong positioning and ongoing contract acquisitions make it an attractive investment with a fair price of $386.90, highlighting significant upside potential as it continues to expand its footprint in key markets.
Molina Healthcare, Inc. (MOH) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 37 hedge fund portfolios held MOH at the end of the third quarter which was 45 in the previous quarter. While we acknowledge the risk and potential of MOH as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than MOH but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article was originally published at Insider Monkey.