Breaking Down agilon health, inc. (AGL) Financial Health: Key Insights for Investors

You're looking at Agilon health, inc. (AGL) and seeing a stock that's dropped a brutal 57.4% year-to-date, and honestly, you need to know if the underlying business has completely broken or if this is a deep value play. The quick take is that management is fighting a tough turn-around, which is why the full-year 2025 guidance is such a mixed bag. For the third quarter of 2025, the company did manage to beat revenue estimates, pulling in $1.44 billion, but that's where the good news stops: the GAAP loss per share exploded to a loss of $0.27 per share, and the net loss was a staggering $110 million. To be fair, they did reinstate their full-year outlook, projecting revenue at the midpoint of $5.82 billion, but still forecasting an adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) loss of negative $258 million-that's a massive profitability challenge, defintely not a minor headwind. We need to dive into the medical margin and the real impact of their cost-cutting measures to see if they can bridge that gap and make the value-based care model work for investors.

Revenue Analysis

You're looking at agilon health, inc. (AGL) because its growth story has been compelling, but the 2025 revenue data shows a clear inflection point. The direct takeaway is that while the full-year revenue is expected to land around $5.82 billion, the quarterly year-over-year growth has stalled and even reversed, primarily due to strategic market exits and a significant headwind from risk adjustment revenue.

The company's business model is centered on a value-based Total Care Model, which means the vast majority of its revenue comes from managing the total cost of care for senior patients, mostly within the Medicare Advantage (MA) sector. This is a crucial distinction: they get a fixed, capitated payment (global capitation) per member to cover all medical expenses, so the revenue is essentially a medical services payment stream.

Here's the quick math on the breakdown from the most recent quarter, Q3 2025, which gives you a clear picture of what's driving the top line:

• Medical Services Revenue: $1.43 billion
• Other Operating Revenue: $2.88 million

Honestly, the 'Other Operating Revenue' is a rounding error; this is a single-segment business, and that segment is medical services. You need to focus on the stability of the core membership base and the associated medical costs, not on diversified revenue streams. That's the whole game here.

The historical revenue growth has been phenomenal, with 2024 annual revenue hitting $6.06 billion, representing a massive 40.41% increase over 2023. But that trajectory has changed defintely. The year-over-year (YoY) growth rate has turned negative in 2025, which is the main concern for investors right now:

The significant change in the revenue stream isn't a drop in service price, but a deliberate restructuring. The Q1 decline was largely due to previously disclosed market exits, which cut total platform membership (including Medicare Advantage and ACO REACH beneficiaries) to 605,000 by March 31, 2025. Then, in Q3, the revenue was further pressured by lower-than-expected risk adjustment revenue-this is the mechanism that adjusts payments based on the health of the patient population (the sicker the patients, the higher the payment). The company's enhanced data platform is giving them better visibility, but that visibility revealed a lower risk adjustment trend for 2025, which translates directly to less revenue per member.

So, while the company is still projecting a full-year revenue of about $5.82 billion, you must understand that this number is being achieved through a mix of new market growth and same-geography growth being more than offset by those strategic exits and the risk adjustment headwind. This is a transition year, where the focus is on improving the quality and profitability of the existing revenue base rather than maximizing top-line growth. For a deeper dive into who is betting on this turnaround, you might want to read Exploring agilon health, inc. (AGL) Investor Profile: Who's Buying and Why?

Profitability Metrics

You're looking for a clear signal of financial health, but for agilon health, inc. (AGL), the 2025 data shows a business still squarely in the investment phase, where high growth clashes with razor-thin, often negative, margins. The direct takeaway is that while the company is generating substantial revenue, its core profitability metrics-Gross Profit, Operating Profit, and Net Profit-remain under significant pressure from elevated medical costs and operational scale-up.

For the full fiscal year 2025, the company's guidance points to a revenue midpoint of $5.82 billion, but its profitability will be almost non-existent at the top line and deeply negative further down the income statement. This isn't a surprise, but the magnitude is what matters for your investment decision.

Gross Profit and Medical Margin: A Razor-Thin Line

In the value-based care (VBC) model, the Medical Margin is the clearest proxy for Gross Profit, representing revenue minus the direct costs of patient care. The 2025 full-year guidance midpoint for Medical Margin is a mere $5 million.

• Medical Margin (FY 2025 Est.): $5 million (on $5.82 billion in revenue).
• Medical Margin Percentage: A stunningly thin 0.09%.
• TTM Gross Profit Margin: The trailing twelve months (TTM) Gross Profit Margin, as of August 2025, was negative 1.76%.

Here's the quick math: A 0.09% margin means that for every dollar of revenue, only about one-tenth of a penny is left after paying for medical services. This razor-thin margin is a major operational risk, as any unexpected spike in utilization (patients using more services) immediately flips the margin negative, as seen in the Q3 2025 Medical Margin loss of negative $57 million.

Operating and Net Profit: The Cost of Scaling

Moving past the direct cost of care, the picture darkens. Operating Profit-or Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) in this case-shows the true cost of running the business, including sales, general, and administrative (SG&A) expenses. For 2025, agilon health, inc. is still burning cash to build its platform.

The full-year 2025 Adjusted EBITDA guidance midpoint is a loss of negative $258 million. This translates to an Adjusted EBITDA Margin of negative 4.43%. This figure is significantly worse than the average Q3 2025 operating margin of negative 1.4% reported by major publicly traded payers focused on government programs, highlighting agilon health, inc.'s unique scale-up costs.

The Net Profit Margin (NPM) confirms the losses. The TTM Net Profit Margin as of November 2025 was negative 5.24%, and analysts forecast a full-year 2025 Earnings Per Share (EPS) loss of approximately negative $0.59. To be fair, one bright spot was Q1 2025, which saw a rare Net Income of $12 million, but this was an outlier, quickly offset by the Q3 2025 Net Loss of $110 million.

Operational Efficiency and Industry Comparison

The trend in profitability is one of persistent pressure. Losses have been increasing by 7.9% annually over the past five years. While revenue growth is strong, the company's operational efficiency-specifically its cost management-is struggling to keep pace with the elevated medical cost trends, which were estimated at a gross cost trend of 6.3% in 2025 for its more mature markets.

Here is a snapshot of the core profitability challenge:

The comparison is stark. Where major health insurers posted an unweighted average Net Profit Margin of 5.3% in Q1 2025, agilon health, inc. is deep in the red. This massive gap underscores the high execution risk inherent in the VBC model, especially when scaling. The market's view is clear: AGL trades at a Price-to-Sales ratio of only 0.1x, a deep discount to the US Healthcare industry average of 1.2x. The market is defintely pricing in the ongoing losses.

For a deeper dive into the company's valuation and strategic framework, you can read the full post: Breaking Down agilon health, inc. (AGL) Financial Health: Key Insights for Investors.

Debt vs. Equity Structure

When we look at how agilon health, inc. (AGL) funds its operations and growth, the picture is one of extreme conservatism on the debt side, which is defintely a good thing in a high-growth, unprofitable stage. You're not seeing the heavy leverage common in other capital-intensive sectors, which significantly reduces the risk of financial distress.

The company relies very little on debt to finance its assets, preferring to use shareholder equity and its existing cash reserves. As of the first half of 2025, agilon health, inc. (AGL) reported a total debt load of approximately $34.9 million. This is a remarkably small figure, especially when you consider that the vast majority of this is short-term debt; the company essentially carries no long-term debt on its balance sheet.

Here's the quick math on their capital structure, comparing it to the industry:

• AGL's Debt-to-Equity Ratio: 11.4% (or 0.114) as of September 2025.
• Industry Standard (Managed Health Care): Approximately 73.5% (or 0.7353).

A Debt-to-Equity (D/E) ratio is a measure of a company's financial leverage, showing how much debt is used to finance assets relative to the value of shareholder equity. agilon health, inc.'s (AGL) ratio is dramatically lower than the industry average for Managed Health Care, which sits closer to 0.7353. This low D/E ratio signals a very sound financial structure, prioritizing equity funding (currently around $306.077 million in total shareholder equity as of Q3 2025) over taking on new liabilities. They have more cash than debt, holding a net cash position of roughly $332.2 million as of March 2025.

The company's financing strategy is clearly focused on managing its burn rate and leveraging its equity base to navigate its path to profitability. We haven't seen any major debt issuances or refinancing activities in 2025, which aligns with their stated goal of maintaining cost discipline and achieving cash flow breakeven by 2026. What this estimate hides, however, is the pressure to manage elevated medical cost trends, which is why maintaining a clean balance sheet is paramount right now. They are using internal cash and equity, not debt, to fund their strategic actions, like reducing Medicare Part D risk exposure to less than 30% of their membership for 2025.

Because agilon health, inc. (AGL) has such a minimal debt load, the major credit rating agencies typically don't issue a public, long-term credit rating. The lack of a rating isn't a red flag here; it's simply a reflection of their low financial leverage, suggesting they are not an active borrower in the bond market. This capital structure gives them substantial flexibility to weather the near-term volatility and focus on their core Mission Statement, Vision, & Core Values of agilon health, inc. (AGL).

Liquidity and Solvency

You're looking for a clear picture of agilon health, inc. (AGL)'s ability to meet its near-term obligations, and the 2025 data shows a thin but technically solvent position, bolstered by a significant amount of receivables. The company is managing a working capital deficit trend while still burning cash from operations.

As of the first quarter of 2025 (Q1 2025), agilon health, inc.'s Current Ratio stood at approximately 1.20 (Current Assets of $1.65 billion divided by Current Liabilities of $1.37 billion). This ratio is better than the reported 1.16 as of Q3 2025, but still indicates that for every dollar of short-term debt, the company has only $1.20 in short-term assets to cover it. The Quick Ratio, which removes less-liquid assets like inventory (negligible for AGL), was a tight 1.17 in Q1 2025, which is defintely a razor-thin margin for comfort. A ratio this close to 1.0 means there is little room for delay in collecting receivables.

The trend in working capital (Current Assets minus Current Liabilities) shows a contraction, which is a key area of concern. The positive working capital position shrank from $276.02 million at the end of Q1 2025 to $203.57 million by the end of Q2 2025. This 26% decline in just one quarter highlights the pressure on the balance sheet, largely driven by the high volume of Medical Claims and Related Payables, which were over $1.11 billion in Q1 2025.

• Current Ratio (Q1 2025): 1.20
• Quick Ratio (Q1 2025): 1.17
• Working Capital (Q2 2025): $203.57 million (down 26% from Q1)

The cash flow statement for the trailing twelve months (TTM) ending September 30, 2025, tells a story of a growth-focused company that is not yet self-funding. Cash Flow from Operations (CFO) for the TTM period was a negative -$68.81 million. This operating cash burn is the primary liquidity challenge, meaning the core business is consuming more cash than it generates. Management is forecasting a full-year 2025 cash burn of approximately $110 million, which they plan to manage through their existing cash position.

The Investing and Financing activities for the TTM period show the following: Investing Cash Flow was a net positive, largely due to a significant $140.46 million from the Investment in Securities line item. This is a key liquidity strength, as it indicates the company has been able to liquidate some of its short-term investments to fund operations and capital expenditures (CapEx), which were modest at -$13.54 million TTM. Financing Cash Flow for Q3 2025 was a small outflow of -$2.98 million.

The main liquidity concern is the consistent negative operating cash flow, which forces the company to rely on its cash reserves and investment liquidations. While the company is projecting a cash balance of roughly $310 million at the end of 2025 (including off-balance sheet cash from ACO entities), this is a finite resource. The strength lies in the high quality of its current assets-mostly cash, marketable securities, and receivables-with minimal inventory risk. To dig deeper into who is holding the stock and why these liquidity concerns haven't triggered a larger sell-off, you should be Exploring agilon health, inc. (AGL) Investor Profile: Who's Buying and Why?

Valuation Analysis

You're looking at agilon health, inc. (AGL) right now and wondering: is this stock a deep-value play or a value trap? The raw numbers, as of November 2025, suggest the market is pricing in significant risk, but the analyst consensus hints at a massive potential rebound. The key takeaway is simple: traditional valuation metrics are broken here because the company is not yet profitable.

The stock has experienced extreme volatility over the last 12 months. The share price has collapsed from a 52-week high of around $6.08 to a recent closing price of just $0.58 as of November 14, 2025. This means the stock lost over 90% of its value in a year. That's a brutal drop. The 52-week low sits right near the current price at $0.56, indicating the market has fundamentally repriced the business due to operational and profitability concerns.

Is agilon health, inc. (AGL) Overvalued or Undervalued?

To be fair, you can't use the standard Price-to-Earnings (P/E) ratio to judge agilon health, inc. because the company is currently unprofitable. The consensus forecast for the 2025 fiscal year Earnings Per Share (EPS) is a loss of -$0.62. When a company is losing money, the P/E ratio is negative or non-existent, making it useless for an apples-to-apples comparison. The same problem applies to the Enterprise Value-to-EBITDA (EV/EBITDA) ratio, which is currently around -0.05, given the negative Trailing Twelve Months (TTM) EBITDA of approximately -$287 Million as of September 2025. You can't value a growth company on a negative metric.

Here's the quick math on the tangible assets: the Price-to-Book (P/B) ratio is a more useful starting point, sitting at approximately 0.78. A P/B ratio below 1.0 suggests the stock is trading for less than the value of its net assets on the balance sheet. Plus, the Enterprise Value (EV) is a negative -$34.98 million, which happens when a company's cash and cash equivalents exceed its market capitalization and total debt. This defintely signals a deep discount, but what this estimate hides is the market's fear about the company's ability to stop burning cash.

The company does not pay a dividend; the dividend yield and payout ratio are both 0.00%. The focus is entirely on growth and achieving profitability, not returning capital to shareholders yet.

Analyst Consensus and Price Targets

Despite the stock's collapse, Wall Street analysts maintain a consensus rating of Hold. This mixed signal tells you that while the risk is high, the potential upside is too significant to warrant a universal Sell rating. The average 12-month price target from 18 analysts is $2.73, which forecasts a massive upside of 374.92% from the current $0.58 share price. The analyst range is wide, with a low target of $1.00 and a high of $6.00. This spread reflects the deep uncertainty surrounding the company's path to positive earnings before interest, taxes, depreciation, and amortization (EBITDA).

The market is clearly pricing in a high probability of failure, while analysts see a viable path to a multi-bagger return if the business model executes. The stock is cheap on a Price-to-Book basis, but the lack of profitability makes it a speculative bet. For a deeper dive into who is making these bets, check out Exploring agilon health, inc. (AGL) Investor Profile: Who's Buying and Why?

Your action here is to treat this as a turnaround play, not a value investment. The risk is total loss, but the reward is substantial if they hit their targets.

• P/E Ratio: Not meaningful (Negative EPS).
• P/B Ratio: 0.78 (Indicates a deep discount to book value).
• EV/EBITDA: -0.05 (Not useful due to negative EBITDA).
• Analyst Consensus: Hold (Average Target: $2.73).

Risk Factors

You're looking for the hard truth on agilon health, inc. (AGL), and honestly, the near-term picture shows significant financial and operational headwinds. The company is in a deep turnaround, which means higher volatility and execution risk. While the business model has long-term promise, the market is currently pricing in heavy doubts about its path to profitability, as evidenced by the stock trading well below its estimated fair value.

Operational & Financial Headwinds

The most immediate financial risk stems from a major shortfall in risk adjustment revenue, which directly impacts the company's Medical Margin (the gross profit from patient care). Management estimates the full-year 2025 impact to Medical Margin from this lower-than-expected risk adjustment is approximately $150 million. This is a huge number that explains the pressure on their bottom line. For the full fiscal year 2025, agilon health, inc. has reinstated guidance for Adjusted EBITDA to be a loss between negative $270 million and negative $245 million, with a midpoint of negative $258 million. That's a persistent loss that challenges the bull case.

Plus, the company is still dealing with the financial drag of strategic market exits, which are expected to negatively impact the 2025 revenue outlook by approximately $60 million. This, along with a year-over-year decline in Medicare Advantage membership, raises concerns about growth durability and revenue concentration.

• Risk Adjustment Loss: Full-year 2025 Medical Margin hit of ~$150 million.
• Persistent Unprofitability: Losses have increased by 7.9% annually over the last five years.
• Cash Burn: Expecting a full-year 2025 cash burn of approximately $110 million.

Regulatory and External Market Risks

The entire value-based care sector faces regulatory uncertainty, particularly around Medicare Advantage (MA) payment models. The Centers for Medicare & Medicaid Services (CMS) is tightening oversight on risk adjustment payments, and the industry is navigating the transition to the new V28 risk model. This external pressure means agilon health, inc. must be defintely precise with its coding and data capture, or face further revenue shortfalls. The company is also exposed to elevated medical cost trends, with an estimated gross cost trend of 6.3% for its year 2+ markets in 2025.

A more immediate, tangible risk is the stock's compliance issue. The company received a non-compliance notice from the NYSE because its stock price traded below the $1.00 minimum for a continuous 30-day period. To regain compliance, they plan to seek a reverse stock split, which is a near-term action that often signals market distress to investors.

Mitigation and Actionable Strategies

The management team is taking clear actions to stabilize the business and reduce financial volatility, though the benefits are expected to ramp up in 2026. They've implemented operating expense reductions of $30 million, primarily by streamlining corporate overhead. They are also strategically reducing their exposure to Part D prescription drug risk from two-thirds of members in 2024 to less than 30% in 2025, which should limit costs outside of their direct control.

The most important operational fix is the enhanced data pipeline, which went live in Q1 2025 and now covers approximately 80% of members. This technology investment is crucial for getting more timely and accurate payer data, which is the foundation for better risk score accuracy and, ultimately, better revenue forecasting. For a deeper dive into the company's long-term vision, you can read the Mission Statement, Vision, & Core Values of agilon health, inc. (AGL).

Growth Opportunities

You're looking for a clear path forward for agilon health, inc. (AGL), and the story is one of disciplined, strategic growth rather than reckless expansion. The direct takeaway is this: agilon health is sacrificing near-term revenue growth for a sharper focus on profitability, which is the only way to build a sustainable value-based care model.

The company has shifted its strategy to prioritize execution and cost control, especially after the mid-year volatility in its 2025 financial outlook. Honestly, their success hinges on whether they can translate their platform's clinical advantages into consistent financial performance over the next two years. That's the whole ballgame now.

Future Revenue and Earnings Outlook

The financial picture for the 2025 fiscal year is volatile, but the company has reinstated guidance as of November 2025. This latest outlook reflects a significant recalibration from earlier in the year, showing the real-world headwinds in the Medicare Advantage (MA) market.

At the midpoint of the reinstated guidance, agilon health projects total revenue of $5.82 billion for 2025, with a medical margin of just $5 million. Here's the quick math: despite the massive revenue base, the company is still forecasting a substantial loss, with Adjusted EBITDA projected at negative $258 million at the midpoint for the year.

This negative earnings forecast is a clear signal that 2025 is a transition year, focused on laying the groundwork for a more profitable 2026. Still, the membership base remains large, with Medicare Advantage membership projected between 503,000 and 506,000 members, plus another 113,000 to 115,000 in the ACO model.

Strategic Growth Drivers and Innovations

The real growth drivers for agilon health aren't in acquisitions right now, but in operational efficiency and clinical program execution. They are using their platform to drive better outcomes, which is the core of their value proposition (global capitation model).

The company is making definetly smart moves to reduce financial risk and improve data visibility. They've cut operating costs by $30 million and are actively reducing their exposure to Medicare Part D risk, aiming to bring it down from two-thirds of their members in 2024 to less than 30% in 2025.

Their technology and clinical programs are where the long-term value is being built:

• Enhanced Data Pipeline: Now covers approximately 80% of members, providing more timely payer data to improve risk score accuracy and forecasting.
• Clinical Program Success: Reduced new inpatient heart failure diagnosis rates from 18% in 2024 to 5% in 2025 across their MA population.
• Market Expansion: Added five new physician practices for 2025, including a first-time entry into the state of Illinois, growing their Physician Network to over 3,000 primary care physicians.

Competitive Edge and Near-Term Risk

agilon health's core competitive advantage is its long-term, 20-year partnership model with primary care physicians (PCPs), which fully commits them to value-based care (VBC). This model is capital-light for the physicians, which is a major draw. Plus, their participation in the ACO REACH program demonstrated $150 million in gross savings in 2023, with cost trends 300 basis points below the Medicare benchmark, showing the model works when executed well.

But, you must be a trend-aware realist. The biggest near-term risk is the continued financial volatility and the ongoing search for a permanent CEO following the leadership change in August 2025. The company has to execute flawlessly on its cost-cutting and clinical initiatives to hit its 2025 targets and set a credible path to cash flow breakeven, which they anticipate by 2027.

If you want a deeper dive into who is betting on this turnaround, you should read Exploring agilon health, inc. (AGL) Investor Profile: Who's Buying and Why?

Next Step: Finance should model the impact of a 10% deviation in the $5 million medical margin projection to stress-test the near-term cash position by the end of the quarter.