Alignment Healthcare (NASDAQ:ALHC) Releases Quarterly Earnings Results, Meets Estimates

Alignment Healthcare (NASDAQ:ALHC) announced its quarterly earnings data on Thursday. The company reported ($0.04) earnings per share (EPS) for the quarter, meeting analysts’ consensus estimates of ($0.04), FiscalAI reports. Alignment Healthcare had a net margin of 0.89% and a return on equity of 20.02%. The firm had revenue of $1.36 billion during the quarter, compared to analyst estimates of $1.31 billion. During the same quarter in the prior year, the firm posted $0.02 earnings per share. Alignment Healthcare’s quarterly revenue was up 36.7% on a year-over-year basis.

Here are the key takeaways from Alignment Healthcare’s conference call:

• Strong third-quarter growth: Membership rose 31% year over year to 301,200, driving revenue growth of 37% to approximately $1.4 billion. Adjusted SG&A leverage improved, and adjusted EBITDA was $22 million.
• Higher medical costs pressured results: Provider appeals and disputes, skilled-nursing expenses, and catastrophic cases increased the medical benefit ratio. The company lowered full-year guidance to at least $575 million of adjusted gross profit and $100 million of adjusted EBITDA, while forecasting fourth-quarter adjusted EBITDA of at least negative $28 million.
• Claims-system transition is stabilizing: The Facets migration created claims-processing volatility and contributed to higher reported costs, but appeals activity and institutional acute trends reportedly improved from August through October. Management is assuming elevated costs persist through the fourth quarter and is not including potential benefits from payment-integrity or clinical initiatives in its guidance.
• California Star Ratings weakened: Six of seven eligible plans retained ratings of four stars or higher, but the California HMO received 3.5 stars, creating future funding pressure. Management is increasing provider and member engagement, improving data workflows, and adding market resources to target recovery.
• Management remains confident in 2027 growth: The company continues to target at least 20% membership growth, supported by new provider relationships and planned expansion into San Antonio and Charlotte. Executives said 2027 bids were recalibrated market by market to balance growth and margins, although detailed guidance will come after annual enrollment results.

Alignment Healthcare Trading Down 1.5%

ALHC opened at $8.06 on Friday. The company has a market cap of $1.67 billion, a P/E ratio of 42.42 and a beta of 1.14. Alignment Healthcare has a one year low of $6.01 and a one year high of $25.12. The company has a debt-to-equity ratio of 1.22, a quick ratio of 1.70 and a current ratio of 1.70. The business’s 50-day simple moving average is $9.99 and its 200-day simple moving average is $16.89.

Alignment Healthcare News Roundup

Here are the key news stories impacting Alignment Healthcare this week:

• Positive Sentiment: Third-quarter revenue increased 36.7% year over year to $1.36 billion, exceeding the $1.31 billion analyst estimate. The strong sales performance is a positive sign for member growth and operating scale. Alignment Healthcare Reports Q3 Loss, Beats Revenue Estimates
• Positive Sentiment: Management updated its full-year outlook alongside the quarterly results, giving investors additional visibility into expected 2026 performance. Alignment Healthcare Reports Third Quarter 2026 Results, Updates Full-Year Outlook
• Neutral Sentiment: Needham began coverage with a “hold” rating, suggesting a balanced view of ALHC’s valuation and growth prospects rather than an immediate catalyst.
• Negative Sentiment: Alignment Healthcare reported a third-quarter loss of $0.04 per share, matching estimates but declining from $0.02 of earnings in the prior-year quarter. The lack of an earnings beat likely limited the benefit of the revenue outperformance. Alignment Healthcare Reports In-Line Q3 EPS and Offers Guidance
• Negative Sentiment: Shares have decreased as investors appear to be weighing the quarterly loss, profitability execution, and the updated outlook against the revenue beat.
• Negative Sentiment: A securities-law firm announced an investigation into potential securities fraud following a sharp prior selloff tied to allegations of inflated EBITDA. The investigation does not establish wrongdoing, but it adds reputational and legal uncertainty for ALHC investors. Alignment Healthcare Securities Investigation

Insider Activity at Alignment Healthcare

In other Alignment Healthcare news, President Dawn Maroney sold 122,707 shares of the company’s stock in a transaction on Friday, September 11th. The shares were sold at an average price of $12.68, for a total value of $1,555,924.76. Following the completion of the transaction, the president owned 794,606 shares in the company, valued at $10,075,604.08. This represents a 13.38% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO John Kao sold 27,400 shares of Alignment Healthcare stock in a transaction that occurred on Monday, September 14th. The stock was sold at an average price of $13.00, for a total value of $356,200.00. Following the transaction, the chief executive officer directly owned 590,766 shares in the company, valued at approximately $7,679,958. This trade represents a 4.43% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 1,061,967 shares of company stock valued at $13,642,490 over the last quarter. 5.20% of the stock is owned by insiders.

Analyst Ratings Changes

A number of equities analysts have commented on the stock. William Blair downgraded shares of Alignment Healthcare from an “outperform” rating to a “market perform” rating in a research note on Friday, October 9th. KeyCorp reduced their price target on shares of Alignment Healthcare from $28.00 to $12.00 and set an “overweight” rating on the stock in a research report on Friday, October 9th. Needham & Company LLC began coverage on Alignment Healthcare in a report on Wednesday. They issued a “hold” rating on the stock. Scotiabank set a $9.00 price target on Alignment Healthcare in a report on Friday, October 9th. Finally, UBS Group cut their target price on Alignment Healthcare from $22.00 to $9.00 and set a “neutral” rating on the stock in a research report on Monday, October 12th. Seven analysts have rated the stock with a Buy rating and six have given a Hold rating to the company. According to MarketBeat.com, Alignment Healthcare has a consensus rating of “Moderate Buy” and a consensus price target of $15.91.

Alignment Healthcare Company Profile

Alignment Healthcare, Inc is a technology-enabled health insurance company focused on providing Medicare Advantage plans for seniors. The company combines health plan coverage with care coordination and clinical services designed to help members manage chronic conditions, access providers and navigate the health care system.

Its offerings include Medicare Advantage plans, supplemental benefits and member support services. Alignment also uses its proprietary technology platform, including the Alignment Virtual Application (AVA), to support care teams, analyze health information and help deliver more personalized services to members.

Founded in 2013, Alignment Healthcare serves Medicare-eligible consumers in selected markets, including California, Florida, Nevada and North Carolina.