Elevance Health (NYSE:ELV) and Alignment Healthcare (NASDAQ:ALHC) Critical Review

Elevance Health (NYSE:ELV) and Alignment Healthcare (NASDAQ:ALHC) are both healthcare companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, dividends, earnings, profitability, valuation, institutional ownership and analyst recommendations.

Volatility & Risk

Elevance Health has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500. Comparatively, Alignment Healthcare has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500.

Profitability

This table compares Elevance Health and Alignment Healthcare’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Elevance Health	2.55%	14.97%	5.31%
Alignment Healthcare	0.59%	12.46%	2.36%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Elevance Health and Alignment Healthcare, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Elevance Health	0	7	15	0	2.68
Alignment Healthcare	1	6	6	0	2.38

Elevance Health currently has a consensus price target of $456.48, suggesting a potential upside of 7.14%. Alignment Healthcare has a consensus price target of $14.00, suggesting a potential upside of 89.32%. Given Alignment Healthcare’s higher possible upside, analysts clearly believe Alignment Healthcare is more favorable than Elevance Health.

Earnings and Valuation

This table compares Elevance Health and Alignment Healthcare”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Elevance Health	$199.12 billion	0.46	$5.66 billion	$23.45	18.17
Alignment Healthcare	$3.95 billion	0.39	-$720,000.00	$0.13	56.88

Elevance Health has higher revenue and earnings than Alignment Healthcare. Elevance Health is trading at a lower price-to-earnings ratio than Alignment Healthcare, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

89.2% of Elevance Health shares are owned by institutional investors. Comparatively, 86.2% of Alignment Healthcare shares are owned by institutional investors. 0.3% of Elevance Health shares are owned by insiders. Comparatively, 5.2% of Alignment Healthcare shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Elevance Health beats Alignment Healthcare on 10 of the 14 factors compared between the two stocks.

About Elevance Health

Elevance Health, Inc. is a U.S. health benefits and services company. Formerly known as Anthem, Inc., it adopted the Elevance Health name in 2022 while retaining the Anthem brand for many of its health plans. The company offers medical, pharmacy, dental, vision and behavioral health coverage, including plans for individuals and employers as well as programs serving Medicare and Medicaid members. Its services also include care management, pharmacy benefit services and other health-related capabilities through its Carelon business.

About Alignment Healthcare

Alignment Healthcare, Inc. is a technology-enabled healthcare company focused primarily on serving older adults through Medicare Advantage plans. Its health plans, offered under the Alignment Health Plan name, combine insurance coverage with care coordination and support intended to address members’ medical and everyday health needs. The company uses a care model that includes personalized care teams, member support and technology to help coordinate services across providers. Its Medicare Advantage offerings include plan options such as HMO and PPO products, with availability and benefits varying by location.