Molina Healthcare Inc. shares plunged Thursday, the day after the Long Beach insurer said losses related to its participation in the
The stock dived $10.71, or 17.9%, to $49.18.
The insurer reported after the close of regular trading Wednesday that its adjusted earnings per diluted share fell to 50 cents last year, down from $2.57 the year before. The results were disappointing: Analysts surveyed by FactSet had expected earnings of $2.78 a share. Income before income taxes fell to $137 million last year from $322 million the year before.
Molina Healthcare said in a statement that the decrease was "primarily the result of the declining profitability of our Marketplace program."
Molina Healthcare covers about 600,000 ACA enrollees in nine states. Speaking during a Wednesday afternoon conference call with analysts, Chief Accounting Officer Joseph White singled out Texas as a state where the insurer was doing "relatively well" on the marketplace He said the insurer was "hanging in there" in Florida and California.
Molina Healthcare has been traditionally known as a Medicaid provider, and its HMO plans are often the low-cost option in ACA plan categories.
The company might soon end its participation in the marketplaces created by the Affordable Care Act, also known as Obamacare. It believes there are "simply too many unknowns" with the Marketplace program to commit to participation beyond 2017, J. Mario Molina, president and chief executive of Molina Healthcare, said in Wednesday's call with analysts.
"We will wait and see how the new administration and Congress will adjust the program, and we plan to evaluate our participation on a state-by-state basis," Molina said.
The company's 2016 results "are clearly unacceptable," he said, but "outside of the Marketplace issues, 2016 was, in many respects, a successful year."
Revenue was $17.7 billion — close to analysts' expectations of $17.8 billion, and up from $14.1 billion the year before.
2:45 p.m.: This article was updated with the stock's closing price.
11 a.m.: This article was updated with a more recent stock price and more information about Molina Healthcare's performance in individual state marketplaces.