Molina Healthcare Stock Falls 53% as One Fund Adds $8.5 Million. Is It a Buy?
Key Points
Redwood Capital Management added 51,600 Molina Healthcare shares in the fourth quarter; the estimated transaction value was $8.48 million based on quarterly average prices.
Meanwhile, the quarter-end stake value increased by $7.91 million, reflecting both share increase and price movement.
The quarter-end position stood at 110,000 shares valued at $19.09 million.
Molina Healthcare now makes up 2% of fund AUM, which places it outside the fund's top five holdings.
- 10 stocks we like better than Molina Healthcare ›
On February 17, 2026, Redwood Capital Management disclosed a buy of 51,600 Molina Healthcare (NYSE:MOH) shares, an estimated $8.48 million trade based on quarterly average pricing.
What happened
According to its SEC filing dated February 17, 2026, Redwood Capital Management increased its stake in Molina Healthcare (NYSE:MOH) by 51,600 shares during the fourth quarter. The estimated value of the buy, calculated using the average closing price for the quarter, was $8.48 million. The fund’s position in Molina Healthcare stood at 110,000 shares, with a quarter-end value of $19.09 million. The reported net position change, including price appreciation, was $7.91 million.
What else to know
- This buy raises Molina Healthcare to about 2% of Redwood Capital Management’s reportable U.S. equity assets.
- Top three equity holdings after the filing:
- NASDAQ: SATS: $246.51 million
- NYSE: AER: $187.59 million
- NYSE: GBTG: $164.12 million
- As of Wednesday, shares of Molina Healthcare were priced at $148.79, down a staggering 53% over the past year and well underperforming the S&P 500, which is instead up about 19% in the same period.
Company overview
| Metric | Value |
|---|---|
| Price (as of Wednesday) | $148.79 |
| Market Capitalization | $7.7 billion |
| Revenue (TTM) | $45.43 billion |
| Net Income (TTM) | $472.00 million |
Company snapshot
- Molina Healthcare provides managed healthcare services primarily through Medicaid, Medicare, and state insurance marketplace programs, with revenue generated from government contracts and premiums.
- The company serves low-income families, individuals, and government-sponsored program beneficiaries across many U.S. states.
- It operates a scalable, capitated payment structure to manage costs and deliver care to approximately 5.1 million members.
Molina Healthcare is a leading provider of managed healthcare services, focusing on government-sponsored programs such as Medicaid and Medicare. The company’s strategic emphasis on operational efficiency and tailored health solutions positions it to address the needs of underserved populations in a highly regulated industry.
What this transaction means for investors
Despite generating more than $45 billion in revenue last year, Molina saw profitability fall sharply as higher medical costs and unfavorable contract dynamics weighed on earnings. Full-year adjusted EPS came in at just over $11, down meaningfully from $22.65 the prior year as the fourth quarter swung to a loss.
What makes this interesting is where it sits relative to the rest of the portfolio. While many of the top holdings skew toward higher-growth, higher-volatility names, this is a more defensive, policy-driven business tied to Medicaid and government programs. The market is already pricing in a tough 2026, with guidance calling for about $42 billion in premium revenue, down 2% year over year, and at least $5 in adjusted earnings per share as the company works through contract resets and exits weaker segments. However, if cost pressures ease and rates catch up, this could end up being a turnaround story.
Should you buy stock in Molina Healthcare right now?
Before you buy stock in Molina Healthcare, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Molina Healthcare wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $508,877!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,115,328!*
Now, it’s worth noting Stock Advisor’s total average return is 936% — a market-crushing outperformance compared to 189% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of March 18, 2026.
Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AerCap. The Motley Fool recommends the following options: long January 2027 $60 calls on AerCap. The Motley Fool has a disclosure policy.
Recommended Articles
