How Investors May Respond To Maximus (MMS) Winning Renewal of Major West Virginia Medicaid Contract

• Earlier this week, Maximus announced it was selected by the West Virginia Department of Human Services to continue as the state's enrollment broker for Medicaid and the Children's Health Insurance Program, supporting access for more than 400,000 residents and maintaining its central role in the state’s health coverage programs.
• In addition to consistently high customer satisfaction, Maximus’s work in West Virginia has included launching impactful programs such as a Social Determinants of Health pilot, helping the state identify and address unmet community needs.
• We'll explore how Maximus's renewal of a major government contract supports its long-term growth assumptions and recurring revenue outlook.

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Maximus Investment Narrative Recap

To be a shareholder in Maximus, you need to believe in its ability to deliver stable growth through longstanding government partnerships and recurring contract revenue. While the recent renewal as West Virginia’s enrollment broker affirms the company’s track record in managing large public sector programs, this specific news has minimal impact on the most urgent short-term catalyst, securing and retaining major federal contracts amid a competitive environment. The largest current risk remains the company’s dependence on government contracts, which are sensitive to policy changes and procurement cycles.

Among recent announcements, the withdrawal of the early re-procurement of the 1-800-MEDICARE Contact Center Operations contract stands out, providing Maximus operational certainty on a large federal contract through 2031. This contract, like the West Virginia renewal, reinforces the visibility of future revenue; the ability to secure multi-year agreements from public sector clients continues to be central to offsetting risks from contract delays or unfavorable terms. However, in contrast to these renewals, investors should also be aware of...

Read the full narrative on Maximus (it's free!)

Maximus' outlook calls for $5.7 billion in revenue and $342.6 million in earnings by 2028. This projection is based on an annual revenue growth rate of 1.7% and an earnings increase of $42.6 million from the current earnings of $300.0 million.

Uncover how Maximus' forecasts yield a $103.00 fair value, a 41% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members estimate Maximus’s fair value from US$73.82 up to US$103, reflecting two distinct analyses. Despite strong contract renewals, ongoing dependence on government spending could shape performance and is worth evaluating alongside these diverse views.

Explore 2 other fair value estimates on Maximus - why the stock might be worth just $73.82!

Build Your Own Maximus Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Maximus research is our analysis highlighting 5 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Maximus research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Maximus' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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