Show notes
In this episode of Yet Another Value Podcast, host Andrew Walker welcomes back Steve Gorelik from Firebird Management for a deep dive into Molina Healthcare (ticker: MOH). Together, they explore the sharp drop in Molina's stock despite its long-standing compounder reputation. Steve outlines how Molina operates as a low-cost Medicaid-focused managed care organization, making it uniquely resilient amid rising medical costs and regulatory challenges. They discuss Molina’s competitive advantages, risks tied to healthcare policy, redetermination effects, and its strategic M&A playbook. Tune in to understand why Steve believes Molina remains undervalued and poised to outperform its peers—even as the broader Medicaid sector stumbles.___________________________________________________________[00:00:00] Intro and sponsor mention[00:02:25] What is Molina Healthcare?[00:05:31] Medicaid model and revenue growth[00:06:25] Molina stock chart and July crash[00:07:13] Industry-wide margin compression[00:11:28] Why Steve sees alpha in Molina[00:13:29] ROE vs. cost structure explained[00:15:04] Admin efficiency as competitive edge[00:17:04] Molina’s playbook and cost culture[00:20:16] Medicaid redetermination impact[00:24:07] Market share gains amid member losses[00:26:26] What's driving cost inflation now[00:28:44] Will premiums rise to match costs?[00:30:26] Regulatory risks in Medicaid[00:32:19] Medicaid vs. private cost efficiency[00:33:54] Denials, approvals, and outcomes[00:37:50] Molina’s denials as cost control[00:40:42] Tender process and doctor networks[00:41:43] What keeps Steve up at night[00:44:41] Acquisitions: model and pipeline[00:47:18] M&A parallels to John Malone[00:48:19] CEO incentives and share ownership[00:50:48] Share buybacks and capital returns[00:51:19] Could Molina be acquired?[00:52:57] Long-term compounding vs. exit[00:53:28] Scooby-Doo investing explained[00:54:23] Wrapping up the conversationLinks:Yet Another Value Blog - https://www.yetanothervalueblog.com See our legal disclaimer here: https://www.yetanothervalueblog.com/p/legal-and-disclaimer