On Tuesday, Stifel analysts adjusted their outlook on Alignment Healthcare Inc (NASDAQ:ALHC), lifting the price target to $23.00 from the previous $18.00 while sustaining a Buy rating on the stock. The company’s stock, currently trading at $20.30, has demonstrated remarkable momentum with a 271% return over the past year and is trading near its 52-week high. The company has shown strong growth with revenue increasing by 48% in the last twelve months. The revision follows the Centers for Medicare & Medicaid Services’ (CMS) release of its Final Rate Notice for 2026, which exceeded market expectations by announcing rates 283 basis points higher than the Advance Rate Notice issued in January.
The CMS’s Final Rate Notice, which includes data from the fourth quarter of 2024, was notably above the anticipated increase of 50-100 basis points. According to Stifel analysts, Alignment Healthcare has successfully gained market share over the last two Annual Enrollment Periods (AEPs), benefitting from the challenges faced by competitors.
With the higher rates set for 2026, competitors are now more likely to maintain or even enhance benefits, which could lead to a more competitive environment for member acquisition. Stifel anticipates that this may result in more challenging member growth for Alignment Healthcare compared to the growth seen in 2024 and 2025.
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