Bright Health Group described an ambitious future Tuesday in its first quarterly earnings report since going public, but investors came away troubled by aspects of the near-term financial picture.
After the Bloomington-based health insurer released second-quarter results that featured impressive revenue growth to $1.1 billion in the April-to-June period, the company's share price plunged by more than 20%.
Analysts cited a mix of factors from worse-than-expected medical cost trends to a disappointing revenue projection for the company's business unit that runs medical clinics.
"The first quarter as a public company was not as clean as we would have liked," wrote Kevin Fischbeck, an analyst with Bank of America, in a note to investors.
Even so, Bright Health Group is pushing ahead with plans to enter new markets as a health insurer while building 20 new clinics next year in North Carolina and Texas.
Founded by veterans of Minnetonka-based UnitedHealth Group, which runs the nation's largest health insurer, Bright Health is part of an industry trend where health insurers and health care providers are connected more closely in hopes of better controlling expenses.
"Making health care right together is built on the belief that by connecting and aligning the best local resources in health care delivery with the financing of care, we can deliver better outcomes at a lower cost for all consumers," Mike Mikan, the chief executive at Bright Health Group, said during a Tuesday conference call with investors.
Thanking the company's workforce of more than 2,500 people, Mikan added: "We are very pleased with our second quarter results and think this a strong start to our journey as a public company."