How did the Medibank (ASX:MPL) share price respond last earnings season?

We look at how shares in the private health insurer fared last time the company reported its full-year results.

| More on:
A doctor looks unsure, indicating share price uncertainty for ASX medical companies

Image source: Getty images

The Medibank Private Ltd (ASX: MPL) share price will be one to watch this reporting season.

With conditions improving in the sector, investors will be keen to see how the private health insurer performed this financial year.

Let’s take a look at how the Medibank share price responded last reporting season.

Here’s how the Medibank share price responded last year

The Medibank share price swung wildly after the company released its full-year results for FY20.

Investors were initially undecided on how to interpret them.

Shares in the private insurance behemoth slumped more than 2% in early trade.

Then, a wave of buying later in the day saw the Medibank share price finish more than 2% higher for the day.

For FY20, the private health insurer noted severe disruptions from the COVID-19 pandemic.

Highlights from Medibank’s FY20 financial report included;

  • Total revenue from ordinary activities of $6.785 billion, down 6% from prior corresponding period (pcp) FY19’s $7.219 billion.
  • Premium revenues of $6.546 billion, up 1.3% to pcp
  • 3.2% increase in insurance claims on pcp
  • Net profit after tax (NPAT) of $315.6 million, a 31.3% on pcp

For the full year, Medibank also announced a final, fully franked dividend of 6.3 cents per share.

The outlook for Medibank

The new year has been much kinder to the Medibank share price.

Shares in the private insurer have soared more than 18% since the start of the year, currently nudging 52-week highs.

There have been several catalysts helping fuel the company’s share price.

The initial trigger can be traced back to February after Medibank announced an increased interest in MyHealth Medical Group.

According to Medibank’s management, the investment will help the company strengthen its focus on preventative health.

A strong half-year report also helped the Medibank share price.

For the 6 months ended 31 December 2020, the private health insurer recorded a 27.3% increase in net profits after tax of $226.4 million on pcp.

Medibank also cited an increase in premiums with a drop in net claims expenses for the half year.

In addition, the company also announced a 5.8 cent, fully franked dividend.

Investors will be keeping a keen eye on Medibank’s shares tomorrow as the company releases its full-year results for FY21.

Should you invest $1,000 in Medibank right now?

Before you consider Medibank, you'll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Medibank wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on 52-Week Highs

three young children weariing business suits, helmets and old fashioned aviator goggles wear aeroplane wings on their backs and jump with one arm outstretched into the air in an arid, sandy landscape.
52-Week Highs

3 ASX 200 shares smashing multiyear highs on Wednesday

What's driving these stocks to their highest point in years today?

Read more »

Four people on the beach leap high into the air.
52-Week Highs

2 ASX 200 shares smashing multi-year highs today

It's a good day for owners of these shares.

Read more »

An excited man stretches his arms out above his head as he reaches a mountain peak representing two ASX 200 shares reaching multi-year high prices today
52-Week Highs

2 ASX 200 shares clocking multi-year highs on Thursday

It's a good day for these ASX 200 stocks. Here's why.

Read more »

Two mature-age people, a man and a woman, jump in unison with their arms and legs outstretched on a sunny beach.
52-Week Highs

Guess which 2 ASX All Ordinaries shares smashed 52-week highs amid today’s carnage

Here's what drove these shares to outperform on Tuesday.

Read more »

A young kid with dark glasses rocks out with a guitar.
Share Gainers

3 ASX 300 shares rocking new 52-week highs on Thursday

Which three shares hit multi-year highs today? Let's take a look.

Read more »

three young children weariing business suits, helmets and old fashioned aviator goggles wear aeroplane wings on their backs and jump with one arm outstretched into the air in an arid, sandy landscape.
52-Week Highs

3 ASX All Ordinaries shares that smashed new 52-week highs today

These three shares all shone today.

Read more »

a group of three electricity workers stand smiling wearing hard hats and high visibility vests in front of an array of high voltage power equipment.
52-Week Highs

How is the Origin Energy share price managing to hit multi-year highs today?

2022 has been good to the Origin Energy share price.

Read more »

a person stands on top of a mountain with hands raised above their head gazing on an amazing sunrise over the landscape and above the clouds.
Consumer Staples & Discretionary Shares

Here’s why the Metcash share price just hit a 15-year high

The Metcash share price was charging today. Say hello to a new 15-year high...

Read more »