The raised revenue guidance and strong 2027 outlook are positive catalysts, but the deteriorating Medical Expense Ratio and negative operating cash flow are significant headwinds. Monitor the Q3 2026 earnings for evidence of MER improvement and cash flow inflection, as the stock's direction hinges on whether the margin pressure is transitory or structural.
Price Chart
Executive Summary
Evolent Health reported Q2 2026 revenue of $652.5M, up 46.9% YoY, but GAAP EPS was -$0.25, a miss vs the -$0.10 Street consensus. The company raised its full-year 2026 revenue guidance to $2.6-$2.7B and tightened its Adjusted EBITDA range to $120-$135M, while providing a bullish 2027 outlook of >25% revenue growth and $150M+ Adjusted EBITDA. However, the Medical Expense Ratio (MER) surged to 95.3% from 84.9% a year ago, signaling significant margin pressure in the Performance Suite, and operating cash flow remained negative.
Key Financial Metrics
Key Facts
- Q2 2026 revenue of $652.5M, up 46.9% YoY from $444.3M.
- GAAP EPS of -$0.25 missed the Street consensus of -$0.10.
- Full-year 2026 revenue guidance raised to $2.6-$2.7B; Adjusted EBITDA guidance tightened to $120-$135M.
- Management issued a 2027 outlook for >25% revenue growth and Adjusted EBITDA midpoint of at least $150M.
- Medical Expense Ratio (MER) worsened to 95.3% from 84.9% in Q2 2025, indicating significant cost pressure.
- Signed a new Oncology Performance Suite partnership expected to generate ~$300M in annualized revenue.
- Cash and cash equivalents fell to $115.7M from $151.9M at year-end 2025.
Financial Impact
Revenue beat consensus by ~8.8% ($652.5M vs $599.8M), but GAAP EPS of -$0.25 missed the Street consensus of -$0.10. Adjusted EBITDA of $28.1M was down 25.3% YoY.
Risk Factors
- Medical Expense Ratio (MER) of 95.3% is unsustainably high and could compress margins further.
- Negative operating cash flow of -$10.3M YTD and declining cash balance raise liquidity concerns.
- The company carries $966.5M in long-term debt against a $346M market cap, creating a highly leveraged balance sheet.
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001628908-26-000084 |
| Document: evh-20260806.htm | 0001628908-26-000084 |
| Document: 0001628908-26-000084-index-headers.html | 0001628908-26-000084 |
| Document: 0001628908-26-000084-index.html | 0001628908-26-000084 |
| Document: 0001628908-26-000084.txt | 0001628908-26-000084 |
| 8-K Data (Synthetic) | 0001628908-26-000084 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Aug 6, 2026 8w ago | 8-K | $3.59 $4.26 | ▲ +18.66% | ▲ +18.06% | $3.46 (−3.62%) |
Jul 8, 2026 12w ago | Press Release | $5.63 $3.59 | ▼ −36.23% | ▼ −38.48% | $3.46 (−38.54%) |
Apr 24, 2026 23w ago | DEFA14A | $3.47 $3.83 | ▲ +10.37% | ▲ +5.42% | $3.46 (−0.29%) |
Feb 24, 2026 31w ago | 8-K | $3.14 $2.27 | ▼ −27.71% | ▼ −22.47% | $3.46 (+10.19%) |
US Market Status
Subscribe to SecBot
Get Real-Time SEC Filing Intelligence
Comprehensive SEC filing analysis delivered the moment filings hit EDGAR. Sentiment scoring, impact analysis, and actionable insights for every material event.
Try SecBot Free Coming soon: SecBot Pro with alerts, watchlists, and API access