All eyes will be on Medibank Private Ltd (ASX: MPL) shares next week.
That's because the private health insurer will be releasing its FY 2023 results on Thursday 24 August.
But what is expected from Medibank?
According to a note out of Goldman Sachs, its analysts are expecting a solid result from the private health insurer.
On the top line, the broker is forecasting health insurance revenue of $7,130.1 million (up 3.9%) and complementary services revenue of $299.7 million (down 6.9%). This brings Medibank's full-year revenue to $7,429.76 million, which is an increase of 3.45% on FY 2022's result.
And with Goldman expecting net claims incurred of $5,920 million and management expenses of $562.9 million, a health insurance operating profit of $647.2 million is forecast for FY 2023.
Combined with corporate overheads and its complementary services earnings, the broker expects Medibank's operating profit to come in at $651.4 million for FY 2023. This will be an increase of 9.6% year on year.
Finally, on the bottom line, the company's net profit after tax is expected to rise 24.9% to $491.9 million, with a full-year dividend of 13.4 cents per share. The latter will be flat on FY 2022's dividend.
Are Medibank shares a buy?
Goldman Sachs isn't in a rush to buy Medibank shares.
The note reveals that the broker has held firm with its neutral rating and $3.44 price target. This is broadly in line with where its shares trade today. It commented:
We await further detail from each health insurers' result to get a better understanding of the trajectory of net margins (overall claims inflation trends i.e. utilisation and hospital indexation as well as pricing expectations net of downgrading).
Incidentally, Goldman is expecting an underlying expense ratio of 7.4% and an underlying net margin of 8.6% in FY 2023.
