Key Moments
- Molina Healthcare shares rose more than 3% at Tuesday’s open after Michael Burry highlighted the stock on his Substack.
- Burry argued Molina is set to remain profitable in Medicaid in 2026 while many competitors could face losses.
- After a decline of more than 43% this year, Burry said the stock looks inexpensive and could draw takeover interest if the valuation stays low.
Investor Interest Lifts Molina Shares
Molina Healthcare shares moved higher on Tuesday morning after investor Michael Burry, widely known for his “Big Short” trade, spotlighted the company’s financial resilience and potential strategic value. The insurer’s stock advanced more than 3% at the market open following Burry’s latest commentary on his Substack.
In his note, Burry contrasted Molina’s performance with broader pressures across the managed-care space, emphasizing what he sees as the company’s disciplined execution and operational strength.
Outlook for Medicaid Profitability
Burry focused in particular on Molina’s positioning within Medicaid. He wrote that the company is structured to remain profitable next year in this business line even as many peers may be facing losses. According to Burry, Molina is “looking to make money (albeit less money) in Medicaid in 2026 while most of its competition loses money.”
He added that he views the insurer as “best-positioned to emerge stronger as the cycle turns.”
Operational Track Record and Valuation
Burry highlighted Molina’s long-standing record of maintaining strong expense ratios and steady underwriting performance. He argued that these characteristics are not fully appreciated by the market given current sentiment toward the sector.
Despite those strengths, Molina shares have fallen sharply this year, with the stock down more than 43%. Burry said this sell-off has left the shares trading at an attractive level compared with the company’s underlying fundamentals.
| Metric | Detail |
|---|---|
| Share price move at Tuesday open | Up more than 3% |
| Year-to-date share performance | Down more than 43% |
| Key business focus | Medicaid profitability in 2026 |
Burry argued that if the valuation remains at current depressed levels, it is “very possible” that Molina could become a takeover target. He also expressed a favorable view of the company’s approach to acquisitions.
Burry’s Position and Sector Perspective
Burry previously disclosed in November that he holds a long position in Molina. He compared the company’s profile to earlier standout opportunities he has seen in the insurance industry. In his view, investors frequently overlook strong operators in this space due to the complexity of the business, creating what he believes can be mispriced assets such as Molina.
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