Oscar, Bright Health among best, worst insurance stock performers in H1

Managed care insurers peppered the lists of best and worst performing US insurance stocks in the first half of the year, according to an S&P Global Market Intelligence analysis.

Oscar Health Inc. shares had the second-largest increase by any publicly traded insurance company, soaring 227.6% year to date through June 30. Would-be disruptors GoHealth Inc. and eHealth Inc. also ranked among the biggest gainers, jumping 88.6% and 66.1%, respectively.

Oscar Health's performance is partially due to efforts to transition its co-founder, Mario Schlosser, to a chief technology officer role and the appointment of seasoned industry veteran Mark Bertolini to lead the enterprise, according to analyst Blake Madden.

"On the day of that announcement, Oscar shares jumped 50%+ and haven't looked back since," Madden said in a June release of his healthcare industry newsletter, Hospitalogy.

Bright Health blues

While certain disruptors in the managed care space were some of the best performers on the Street, not every company in the space enjoyed a similar positive first six months of the year.

Embattled Bright Health Group Inc. topped the list of the 10 worst performing insurance stocks, plunging 76.5% year to date through June 30. The Minneapolis-based insurer's struggles have been well publicized in recent months, and a reverse-stock split in May did little to change the stock's fortunes.

Last month, Bright Health agreed to sell its California Medicare Advantage business, Brand New Day and Central Health Plan, to Molina Healthcare Inc. for $600 million. The company said it will use the proceeds to satisfy its obligations to its bank lenders, with the remaining proceeds put toward liabilities in its discontinued Affordable Care Act insurance business.

Other companies posting outsized declines included EverQuote Inc. and Alignment Healthcare Inc., which had the third- and fourth-largest percentage declines on the list, falling 55.9% and 51.1%, respectively.

EverQuote, an online marketplace operator for insurance shopping, was also among the worst-performing US financial stocks in May, joining a trend of underperforming financial technology companies.

The company said July 6 that it was exiting its health insurance vertical beginning June 30. That business includes its marketplace for Medicare and the under-65 health insurance market, which together represented approximately 10% of the EverQuote's revenue in fiscal year 2022.

Florida sunshine

United Insurance Holdings Corp. posted the biggest stock price gain of any US insurance company in the first half of the year, skyrocketing 320.8%.

The massive rally followed a difficult 2022 during which the company reported a net loss of $469.9 million. Earlier this year, subsidiary United Property & Casualty Insurance Co. was placed into receivership with the Florida Department of Financial Services.

But the property and casualty insurer saw its value jump sharply at the end of May, around the time it said it had secured 100% of the capacity needed for its 2023–2024 catastrophe reinsurance program for American Coastal Insurance Co. Inc.

Trupanion shares leashed

Pet insurer Trupanion Inc.'s stock has been in the doghouse for the last six months, falling 58.6% since the start of the year. Trupanion's tumble hit its nadir in mid-March as the company said its CFO was stepping down and two executive vice presidents were departing immediately.

In a June interview, Piper Sandler analyst John Barnidge said Trupanion has been among the more shorted US stocks and was the second-most shorted company across the financial sector at the end of April. Barnidge cited the management turnover as well as the pet insurer's profitability issues with pricing as part of the reason why shares have been targeted by short sellers.

Troubles for Chinese players

US-listed Chinese insurers also had a tough time with Waterdrop Inc. and Tian Ruixiang Holdings Ltd. falling by 37.54% and 27.51%, respectively, during the first half of 2023. Their downward trajectory follows an ongoing trend for Chinese insurers that saw China Life Insurance Co. Ltd. depart the NYSE in 2022.