---
title: "Centene Q3 2026: Revenue and EPS Beat Estimates, but Cash Flow Turned Negative"
canonical_url: https://www.stockexpertai.com/journal/2026-10-27/centene-q3-2026-revenue-and-eps-beat-estimates-but-cash-flow-turned-negative-428471e1cfa4
last_updated: 2026-10-27T10:25:09.121Z
section: "Earnings Watch"
author: "Stock Expert AI Research"
publisher: Stock Expert AI
tickers: CNC
content_type: journal-article
---

# Centene Q3 2026: Revenue and EPS Beat Estimates, but Cash Flow Turned Negative

_Centene reported third-quarter revenue of $50.65B and EPS of $0.58, both above estimates, though GAAP net income was slightly negative and operating cash flow was -$3.69B._

![Data cover: Centene Q3 2026: Revenue and EPS Beat Estimates, but Cash Flow Turned Negative](/public-objects/streetnews/2026-10-27/EARNINGS_WATCH-cover-69fca718.jpg)
Stock Expert AI data cover: figures from Financial Modeling Prep; background is an illustrative public-domain photo, credited on the image.

Centene Corp. (NYSE: CNC) reported third-quarter 2026 revenue of $50.65B against an analyst estimate of $47.12B, and EPS of $0.58 against an estimate of about $0.10. Revenue was higher than the $49.69B in the third quarter of 2025. The company's GAAP (standard accounting) results were still a small loss, and cash flow for the quarter was sharply negative, so the beat comes with caveats.

## Key facts

- **Reported Oct. 27, 2026, for the third quarter ended Sept. 30, 2026:** EPS of $0.58 versus an estimate of about $0.10 (a difference of +$0.48). Revenue was $50.65B versus an estimate of $47.12B (a difference of +$3.53B, or 7.5%).
- **Year-ago comparison:** Revenue in the third quarter ended Sept. 30, 2025 was $49.69B, so revenue rose 1.9%. Diluted EPS was -$0.14 this quarter versus -$13.5 a year earlier.
- **GAAP profit:** Net income was -$71.0M in the latest quarter versus -$6.63B in the year-ago quarter. Operating income was -$307.0M versus -$6.95B.
- **Cash flow:** Free cash flow (cash from operations minus capital spending) was -$3.88B in the latest quarter, after $4.20B in the second quarter of 2026.
- **Stock:** The latest quote was $68.07 as of Oct. 26, 2026, down 2.99%, before the report. The 52-week range is $31.63 to $72.5.

| Metric | Q3 FY2026 (latest) | Comparison |
|---|---|---|
| Revenue | $50.65B | Estimate $47.12B; year-ago $49.69B |
| EPS (as reported by FMP) | $0.58 | Estimate $0.09578 |
| Diluted EPS (GAAP) | -$0.14 | Year-ago -$13.5 |
| Net income | -$71.0M | Year-ago -$6.63B |
| Operating income | -$307.0M | Year-ago -$6.95B |
| Gross margin | 17.5% | Year-ago 16.4% |
| Operating margin | -0.6% | Year-ago -14.0% |

## What happened

Centene is a health insurer whose segment mix, shown below, leans heavily toward government-sponsored plans. It collects premiums, mostly from Medicaid, Medicare and the individual (commercial) market, and pays medical bills out of them. Its profit depends on how much of each premium dollar goes to care.

The revenue beat is clear: $50.65B against a $47.12B estimate. The EPS beat needs context. The $0.58 figure and the estimate of about $0.10 are both small, so the percentage gap (505.6%) looks huge but reflects a tiny base. The GAAP diluted EPS was -$0.14, meaning the company still lost money on a standard accounting basis. The difference between the two figures usually comes from adjustments the company excludes, such as one-time items. We did not have the company's release or call transcript for this article, so we cannot say which items drove the gap.

The year-ago comparison is dramatic mainly because the third quarter of 2025 was very weak. That quarter had a net loss of $6.63B and an operating margin of -14.0%. Against that base, a net loss of $71.0M is a 98.9% improvement in net income, but it is still a loss.

### The five-quarter trend

The past five quarters show a business that went from deep losses back to roughly break-even:

| Quarter ended | Revenue | Gross margin | Operating margin | Net income |
|---|---|---|---|---|
| Sept. 30, 2025 | $49.69B | 16.4% | -14.0% | -$6.63B |
| Dec. 31, 2025 | $49.73B | 15.2% | -3.5% | -$1.10B |
| March 31, 2026 | $49.94B | 21.9% | 3.7% | $1.54B |
| June 30, 2026 | $44.38B | 10.4% | 3.1% | $1.09B |
| Sept. 30, 2026 | $50.65B | 17.5% | -0.6% | -$71.0M |

Two things stand out. First, profitability recovered by the first quarter of 2026, with a net income of $1.54B, then slipped back. The operating margin in the latest quarter was -0.6%, below the 3.7% and 3.1% of the prior two quarters. Second, revenue dropped in the second quarter to $44.38B before rebounding to $50.65B. Insurers' reported revenue can swing with adjustments to premiums and plan mix, and we could not verify the cause from the data we had.

Segment data is available only through the second quarter of 2026. In the quarter ended June 30, 2026, Medicaid revenue was $31.97B, Medicare revenue was $11.06B, Commercial revenue was $9.36B, and Other revenue was $1.20B. Medicaid revenue was lower than a year earlier, which shows how much of the company's revenue depends on state-run programs.

### Cash flow reversed

The cash flow trend is the part of the quarter that deserves the most attention:

| Quarter | Operating cash flow | Free cash flow |
|---|---|---|
| Q3 FY2025 | $1.36B | $1.15B |
| Q4 FY2025 | $437.0M | $224.0M |
| Q1 FY2026 | $3.60B | $3.40B |
| Q2 FY2026 | $4.37B | $4.20B |
| Q3 FY2026 | -$3.69B | -$3.88B |

As general background, not a finding about Centene, insurers' cash flow can be lumpy because of the timing of payments between the company, the government and healthcare providers. We could not determine the cause of this quarter's outflow from the data we had. It is a sharp reversal from the two prior quarters. Capital spending was steady at $194.0M. Buybacks were small at $24.0M, and the company pays no dividend.

### Balance sheet

As of Sept. 30, 2026, Centene held $23.59B in cash and short-term investments against $15.54B of total debt. Net debt, as reported by FMP, was -$5.16B, a negative figure that indicates cash above debt. Shareholders' equity was $22.21B, and debt/equity was 0.71. Much of an insurer's cash is held to pay future claims, so cash here is not all freely available.

## Why it matters for investors

**Valuation.** FMP's trailing 12-month figures do not yet reflect the third quarter of 2026, so they are dated. On that basis, Centene's price/sales ratio is 0.17 and its price/free cash flow is 3.75. The price/free cash flow figure predates the third-quarter cash outflow of -$3.88B, so it should not be read as a sign the stock is cheap. FMP's P/E (price relative to per-share earnings) is -6.55 and its net margin is -2.6%, but both appear to include the large third-quarter 2025 loss and leave out the latest quarter. The quarterly figures in the table above show profits in the first two quarters of 2026, so these ratios are of limited use here.

For reference, here is how those FMP figures compare with peers:

| Company | Market cap | P/E | Net margin |
|---|---|---|---|
| Centene (CNC) | $33.63B | -6.55 | -2.6% |
| Cigna (CI) | $80.80B | 12.61 | 2.3% |
| CVS Health (CVS) | $118.34B | 24.16 | 1.2% |
| Elevance Health (ELV) | $93.54B | 18.37 | 2.5% |
| Alignment Healthcare (ALHC) | $1.64B | 39.55 | 0.9% |

Centene's row reflects the stale trailing figures, so the comparison with peers is not like for like. Investors should watch whether earnings stay positive before reading much into any multiple.

**Analysts.** Of 44 ratings, 27 are Buy, 16 are Hold and 1 is Sell, for a consensus of "Buy." Analysts' average price target is $70.13, with a median of $72.50, a high of $80.00 and a low of $40.00. The latest quote was $68.07 as of Oct. 26, down 2.99%, near the average target. These are analyst views, not our forecast. FMP's own discounted cash flow model puts value at $108.80 per share, but that is a model estimate that depends heavily on its assumptions.

**Our MoonshotScore.** Stock Expert AI's MoonshotScore V2 for Centene is 73.3, rated Strong. The pillars, measured relative to the sector, are:

- Momentum: 93 (strong)
- Valuation: 86 (strong)
- Quality: 74 (solid)
- Growth: 51 (middling)
- Safety: 19 (weak)

The score rewards the recent share price strength and the valuation pillar, though that pillar rests partly on multiples built from figures that predate the latest quarter. The weak safety pillar matches the volatility in earnings and cash flow shown above.

**What could go wrong.** Several risks are visible in the numbers:

- The latest quarter still had a GAAP loss and a negative operating margin.
- Free cash flow turned sharply negative.
- Medicaid is the largest revenue source, so changes in state funding or enrollment matter a great deal.
- Financial-strength scores are middling: a Piotroski score of 6 out of 9 and an Altman Z of 2.79.
- Insider filings show no open-market purchases and 2 sales in the last 90 days, based on the 30 most recent Form 4 filings, which may be incomplete.

## What to watch next

- **Cash flow:** whether operating cash flow returns to positive in the fourth quarter, or whether the third-quarter outflow was a timing effect.
- **Operating margin:** whether it moves back above zero after -0.6% in the latest quarter.
- **Medicaid revenue:** it was $31.97B in the second quarter of 2026, and it is the segment that drives the total.
- **Analyst estimates (2028, not the next quarter):** these consensus figures are for periods well into 2028. For the period ending 2028-03-30, six analysts expect revenue of $50.65B (range $48.80B-$52.24B) and EPS of 3.70. For the period ending 2028-06-30, they expect revenue of $51.40B (range $49.53B-$53.02B) and EPS of 2.52.
- **Share reaction:** the latest quote of $68.07 predates the report, so the market's response will show up in the next trading session.

## Frequently asked questions

## Q: Did Centene beat earnings estimates in the third quarter of 2026?

Yes, on both measures. Revenue was $50.65B against an estimate of $47.12B, and EPS was $0.58 against an estimate of about $0.10. However, GAAP diluted EPS was -$0.14 and net income was -$71.0M, so the company still posted a small loss on a standard accounting basis.

## Q: Is Centene profitable right now?

Recently, only partly. The company earned $1.54B in the first quarter and $1.09B in the second quarter of 2026, then reported a small net loss of $71.0M in the third quarter. The two quarters before that were large losses: -$1.10B in the fourth quarter of 2025 and -$6.63B in the third quarter of 2025. FMP's trailing ratios (a net margin of -2.6% and a negative P/E) do not yet reflect the third quarter of 2026, so they are not a reliable guide. The business is much improved, but it has not yet shown steady profits.

## Q: What do analysts think of Centene stock?

Of 44 analyst ratings, 27 are Buy, 16 are Hold and 1 is Sell, and the consensus is "Buy." Their average price target is $70.13, with a range of $40.00 to $80.00. These are analysts' views and not a recommendation from Stock Expert AI. This article is for information only and is not investment advice.



*This is educational content, not investment advice. Past performance does not guarantee future results.*

## Related Tickers
- [CNC](https://www.stockexpertai.com/stock/cnc)

## Sources
- [Stock Expert AI CNC page: quote, financials and MoonshotScore](https://www.stockexpertai.com/stock/cnc)

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_AI-generated under human editorial supervision. Educational research, not financial advice._