Long Beach-based health insurance giant Molina Healthcare watched its stock price tumble Thursday, dropping $10.71 to $49.18, setting off alarms in the wake of Wednesdays deeply disappointing revenue report. <\/p>\n
The company reported an $8 million profit for the 2016 calendar year on Wednesday, down from $143 million in 2015. Officials blamed the fall on rules within the Affordable Care Act that seek to create an even-playing field in the insurance market. <\/p>\n
Molina Healthcares total revenue last year topped $17.7 billion, but its risk transfer payments a complex system that seeks to provide parity to insurers who must take patients, regardless of their health needs added up to $325 million more than what the company projected when setting its 2016 pricing levels. <\/p>\n
Molina said in a call on Wednesday with investors that the government needs to change the rules, which fueled its revenue losses. The company alleged the government collected millions of dollars more than it should have. <\/p>\n
Molina officials say they filed a lawsuit in January seeking to recover roughly $52 million in risk corridors payments made in 2015. Molina also alleges that the government owes it $90 million in payments made last year. <\/p>\n
Molina was not alone on a rugged Thursday on Wall Street. Avon Products, a direct seller of cosmetics, also plunged after reporting weaker-than-expected results. The company said the number of sales representatives, who are famous for selling its products door to door, slipped from a year earlier. The stock dropped $1.09, or 18.6 percent, to $4.77. <\/p>\n
The days largest loss within the S&P 500 came from TripAdvisor, which fell $5.78, or 11 percent, to $46.92 after reporting weaker revenue and earnings for its latest quarter than analysts forecast. <\/p>\n
The news came as stock markets around the world took a breather Thursday, breaking up a torrid run thanks to an improving economy, stronger corporate earnings and hopes for more business-friendly policies from Washington. <\/p>\n
The Standard & Poors 500 index dipped Thursday to break a seven-day winning streak, its longest in three and a half years, though it remains a nudge away from its record high. <\/p>\n
The dollars value also dipped against rival currencies, and Treasury yields fell as bond prices rose. <\/p>\n
The S&P 500 fell 2.03 points, or 0.1 percent, to 2,347.22. The Dow Jones industrial average rose 7.91 points, less than 0.1 percent, to set another record at 20,619.77. The Nasdaq composite dipped 4.54 points, or 0.1 percent, to 5,814.90. Four stocks fell for every three that rose on the New York Stock Exchange. <\/p>\n
Analysts said it wasnt surprising to see stocks take a break following their long run higher. <\/p>\n
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The market has reacted quite strongly to the Trump reflation trade, deregulation and lower-tax comments over the last couple weeks, said Nate Thooft, senior portfolio manager at Manulife Asset Management. And on top of that weve had a pretty darn good earnings season. It just needs a little bit of a breather today. <\/p>\n
He said he still sees stocks as better investments than bonds. <\/p>\n
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Long Beach-based Molina Healthcare's stock tumbles after poor earnings report - Long Beach Press Telegram<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Long Beach-based health insurance giant Molina Healthcare watched its stock price tumble Thursday, dropping $10.71 to $49.18, setting off alarms in the wake of Wednesdays deeply disappointing revenue report. The company reported an $8 million profit for the 2016 calendar year on Wednesday, down from $143 million in 2015. Officials blamed the fall on rules within the Affordable Care Act that seek to create an even-playing field in the insurance market Continue reading