Investing.com-- Analysts at Stifel have increased their price target for Alignment Healthcare LLC (NASDAQ:ALHC), citing robust 2025 annual enrollment period (AEP) results and continued competitive advantages.
The brokerage hiked PT to $16 from $14 while maintaining a "Buy" rating.
Alignment reported a 35% year-over-year increase in health plan members, reaching approximately 209,900 as of January 1, 2025. This growth included a doubling of membership outside California, now comprising 14% of the total, and positions the company to reach 225,000–231,000 members by year-end—a 22–25% increase from 2024 guidance midpoints.
The strong performance stems from Alignment’s tech-enabled Medicare Advantage (MA) plan, which has consistently outperformed legacy players, analysts said.
According to Stifel, Alignment captured significant market share during the latest AEP, with 82% of new members switching from competitors’ MA plans. Notably, 75% of those came from plans rated below 4 stars, highlighting Alignment’s ability to maintain its 4-star rating while most competitors faced downgrades.
Stifel also pointed to broader industry dynamics as a catalyst for Alignment’s growth. Competitors have struggled with regulatory challenges, including the V28 risk adjustment model and changes to star rating metrics. Additionally, the 2025 advanced rate notice, released over the weekend, exceeded expectations, creating optimism for additional tailwinds under the new administration.
Stifel views Alignment's valuation as attractive, especially for a company just surpassing breakeven and benefitting from multi-year tailwinds through 2027.
The brokerage believes Alignment’s focus on margin improvement and sustained share gains positions it well for long-term growth.