WellPoint, Inc. (NYSE:WLP) released its third quarter results before opening bell this morning, beating consensus and even raising its EPS guidance and membership guidance for the full year. The insurance provider reported net income of $2.16 per share, including 6 cents per share from items. Adjusted net income for the quarter was reported to be $2.10 per share.
Operating revenue surged to $17.73 billion for the quarter. That’s a 17% increase over revenue from the same quarter a year ago. Analysts had been expecting WellPoint, Inc. (NYSE:WLP) to report earnings of $1.81 per share on revenue of $17.66 billion. Shares of WellPoint rose 2% in premarket trading after the results were announced.
WellPoint reports higher enrollment year over year
The company reported that as of the end of September, it had 35.5 million members enrolled in its medical plans. That’s an increase of 2 million members or 6% from the same quarter a year ago. Medicaid membership rose by more than 2.4 million members due to WellPoint, Inc. (NYSE:WLP)’s inclusion of Amerigroup in its third quarter results. WellPoint acquired Amerigroup in the fourth quarter of last year. WellPoint reported that the increase in Medicaid enrollment was partially offset by a decline of 365,000 in the Commercial business and 61,000 in the Medicare business.
Sequentially, medical enrollment fell by 158,000 members during the quarter, mostly in the Medicaid business. The company cited the transition from the Healthy Families program to Medi-Cal in California and also the expiration of its Ohio Medicaid contract.
WellPoint raises guidance
WellPoint, Inc. (NYSE:WLP) also increased its earnings per share guidance for the full year of 2013. Net income for the year is now expected to be at least $8.45 per share, including 5 cents per share from items. Adjusted net income is expected to be at least $8.40 per share. These numbers are an increase of 40 cents per share.
The insurer expects operating revenue for the full year to be between $70 billion and $72 billion. It believes medical enrollment at the end of the year will be around 35.6 million.
WellPoint announces capital return plans
The company’s board of directors declared a fourth quarter dividend of 37.5 cents per share. That dividend will be payable on Dec. 23 to shareholders of record on Dec. 9. The insurer paid a dividend of the same amount during the third quarter.
During the third quarter, WellPoint, Inc. (NYSE:WLP) also bought back almost 6.5 million shares of common stock for $554.9 million. In all three quarters of the year, the company bought back 15.6 million shares or 5.1% of the shares outstanding at the end of last year. The insurer has about $4.2 billion of board-approved share repurchase authorization left on its current program.