Healthcare Giants Lost $71 Billion in Stock Value Year-to-Date

November 17, 5:44 am

Healthcare giants have had a rough few years. After their impressive performance during the pandemic, especially those involved in vaccines and treatments, the stock value of the world's largest healthcare companies plunged in 2023, and 2024 doesn't look much better.

According to data presented by AltIndex.com, five of the ten largest healthcare companies by market cap have seen their stock value plunge year-to-date, and their combined loss amounts to over $71 billion.

CVS Health and Centene are the Worst Performers with a Combined Stock Value Drop of $47 Billion

For the past two years, healthcare giants have struggled to maintain momentum, and there are several reasons for that. Regulatory changes, including cuts to Medicare Advantage reimbursements and Medicaid disenrollment, inflation, rising interest rates and operational costs, valuation pressures, as well as high cost of innovation with slow returns across the sector, have had a major impact on profit margins and the stock value of the world's largest healthcare companies.

According to AltIndex and Companies Market Cap data, five of the ten largest healthcare companies by market cap have seen their stock values plunge in 2024, and their combined loss amounts to over $71 billion year-to-date. Most of that loss came from only two companies, CVS Health (CVS) and Centene (CNC), the worst performers in the top group.

The US healthcare giant and the sixth largest company in this sector, CVS Health, is facing ongoing financial struggles, which led to multiple downward revisions to its earnings forecasts, cut investors' confidence, and caused a huge stock value drop year-to-date. Since the beginning of the year, CVS Health's stock value plunged by over $35 billion, the worst decline among the ten healthcare giants. Last week, the company's market cap stood at $69.3 billion, down from $104.7 billion in January.

Centene, the second-worst performer on this list, saw its market cap plunge by almost 30% or $11.7 billion year-to-date. Although the US healthcare insurer increased its revenue forecast for 2024, exceeding analyst expectations, it maintained adjusted earnings guidance below market estimates, leading to a perception of limited profit upside. The mixed performance and external headwinds have caused the company's stock value to drop to $29.6 billion last week, down from $41.3 billion in January.

The world's second-largest healthcare company by market cap, Elevance Health, lost roughly $16 billion or 14% in stock value year-to-date, with its market cap now standing at close to $95 billion. Siemens Healthineers and Cigna follow with $6.2 billion and $1.6 billion year-to-date stock value drops, respectively.

S&P 500 Healthcare Index is Up by 5.8% YTD, the Smallest Return Among Sectors

With most healthcare stocks struggling to maintain momentum in 2024, healthcare industry continues trailing behind other S&P 500 sectors and the broader market. According to S&P Global data, the healthcare sector index is up 5.8% year-to-date, following a modest 2% return in 2023.

In comparison, information technology and financials jumped by more than 30% year-to-date, outpacing the broader S&P 500, which is up by 24.7% for the same period. Utilities and energy sectors saw 22% and 13% gains, respectively. Statistics show that the S&P 500 real estate sector index saw the second smallest return behind healthcare, at 6.8%, year-to-date.

Get More Insights

Sign up and get access to a personalized dashboard, deeper insights, AI stock picks, stock alerts, weekly newsletter and much more.