Oscar Health: A 2026 Rebound (Ticker: OSCR)

Short-term speed bumps in the health insurance market are giving us a buying opportunity

“The number one is, did we and our competitors price market morbidity correctly? Because when I look at my peers and I see pricing where we’re all kind of in the same band, it’s not like there’s a whole bunch of people that have taken different points of view as to what morbidity is going to be next year. That might be because a whole bunch of consultants were walking around selling their information to all of us over and over again. And we all took input from similar sources. I would, first of all, say that if you believe that we’re mispriced, I think you probably think the market’s mispriced. The biggest risk for this industry is going to be, what’s the market morbidity next year? We believe that we built in more than enough for us to accommodate that in our pricing.” - CFO Scott Blakely, UBS Global Healthcare Conference, November 2025

Health insurers such as Oscar Health (ticker: OSCR) have been caught off guard in 2025 with rising healthcare utilization. This, in turn, has caused Medical Loss Ratios (MLR, or the % of claims paid out vs. premiums earned in a given period) to be abnormally high.

For an upstart with less scale than the legacy players, a rising MLR has reversed Oscar Health’s operating leverage, sending it from a LTM operating profit of $168 million in March 2025 to a $210 million loss in September. 2025 guidance calls for a $250 million loss at the midpoint.

My thesis is simple: 2025 is a temporary blip for Oscar Health’s MLR. Over the next decade, it has a clear path to MLR stability, improved operating leverage, and market share gains, which should provide the stock with upside in 2026 and the potential for ten-bagger returns over the next decade.

In this update, I will discuss:

• Q3 earnings, 2026 pricing, and ACA market uncertainty

• The importance of the SG&A ratio

• What will cause the stock to get “unstuck”

• Whether Oscar Health still has an emerging moat

Anyone can read my complimentary introductory research report on Oscar Health, which was published in July 2025.

Here is the Q1 schedule for Emerging Moats Research. Full reports will be coming out on Evolus, MercadoLibre, and Nelnet. Reach out to get your (one-time) complimentary trial to check out the service.

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2026 Pricing and ACA Subsidies