2025 has been a good year to have owned shares of ASX 200 health insurance provider NIB Holdings Ltd (ASX: NHF). NIB shares started the year back in January at $5.52 each. Today, those same shares are going for $6.56 at the time of writing. That's up 0.92% for the day thus far, and up an impressive 18.84% year to date.
Over the same period, the S&P/ASX 200 Index (ASX: XJO) has gained a far tamer 4.1%. That means NIB shares have more than quadrupled the returns of the broader market so far in 2025.
Yesterday, we covered a similar track record for NIB's rival in the health insurance space, Medibank Private Ltd (ASX: MPL). Medibank shares have also had a stunning 2025, up almost 20% so far this year.
Much of that success stemmed from a bullish earnings report from February.
It's a slightly different story with NIB, which also dropped its latest half-year earnings in February.
As we covered back then, this report saw NIB reveal a 7.7% rise in revenues to $1.8 billion over the six months to 31 December. However, the company also reported an underlying operating profit of $106 million, which was down 26.7% from the same period in 2024.
NIB's statutory earnings per share (EPS) also fell from 22 cents per share to 17.1 cents. That resulted in a reduction in the NIB interim dividend from 15 cents to 13 cents per share.
Even so, it seems investors didn't mind.
What's next for NIB shares?
It is worth noting, however, that although NIB has notched up a fantastic track record in 2025 so far, its performance is far more muted if we zoom out a little. To illustrate, the company has lost over 12.7% of its value over the past 12 months, even with that healthy year-to-date rise. NIB is also around 25% down from its most recent all-time high, which we saw back in mid-2023.
But let's see what an ASX expert makes of the NIB share price at its current level. Unfortunately for NIB enthusiasts, it's not good news.
In a recent note to clients, brokers at Macquarie gave NIB shares an 'underperform' rating, alongside a 12-month share price target of $5.55. If realised, that would see investors lose around 15.4% from where the shares are today.
Macquarie is primarily bearish on NIB thanks to the company's NDIS operations through its acquisition of Maple Plan. It points out that NIB's successful increase in fraud identification is "resetting revenue streams per participant lower, as well as the total count of participants". As a result, Macquarie argues that this could "make earnings growth challenging" in the short-to-medium term.
It's not all bad news, though. The broker estimates that NIB will be able to grow its EPS from 41.7 cents in FY2025 to 45.4 cents in FY26 and 50.8 cents in FY27.
Despite this, Macquarie clearly thinks the current NIB share price is too high and has subsequently recommended clients to sell. Let's see if the broker is on the money here going forward.
