Cambiar Sees Further Earnings Upside at Elevance Health

Elevance Health’s current-year earnings are still 30% to 50% below levels the business could reach in a normalized environment, according to Cambiar Opportunity Fund. The fund named the insurer a positive stock-selection contributor in its second-quarter 2026 letter.

Cambiar said elevated utilization rates weighed on health insurers’ earnings in recent years. It said the industry responded with pricing and underwriting actions that have helped stabilize profits.

The fund said its conviction to maintain positions in Elevance and Centene after a difficult 2025 had begun to pay off. It also noted that both insurers’ share-price recoveries had lifted their price-to-earnings ratios, while its analysis still showed a gap between current and normalized earnings.

The Opportunity Fund gained 11.58% in the quarter, below the Russell 1000 Value Index’s 13.87% return. The letter said an underweight position in technology stocks weighed on the fund’s relative performance.

As of 16:14 UTC on Oct. 1, Elevance shares traded at $381.47, down 1.89% since the previous close.