Medibank Private Ltd (ASX: MPL) Share Price and News
About Medibank Private Ltd
Medibank is a private health insurance company. It was formerly a government entity but was privatised a decade ago and listed on the ASX. It serves over 4 million customers.
Medibank Private Ltd Company History
Started as a government initiative in 1976, it was a response to regulate private health insurance prices. Medibank gradually broadened its scope to offer other forms of insurance too, such as travel, life and pet insurance.
The company listed on the ASX in 2014 as the Abbott government wanted to sell it. The company continued to innovate in the years ahead - most notably entering the in-home healthcare services market by buying Home Support Services (HSS) in 2018. The company was hit with a cyberhack in late 2022 that hit its share price for several months, although its share price gradually recovered.
Medibank's Outlook
Medibank has well and truly recovered from the cyber attack and is recording policyholder growth, particularly amongst those taking out cover for the first time.
It faces a number of risks, however, in the forms of industry competition, the risk of people giving up private health insurance due to cost of living pressures as well as underperformance in its investments.
Even though Medibank’s FY24 profit rose 60% to $492.5m, the company missed its target to increase permanent resident policy numbers. Specifically numbers only grew 0.7% after it had forecasted 1.2-1.5%. It was not all bad news – its non-resident policy growth increased 25% as returning foreign students took up its cover, although of course this growth will not persist if politicians have their way.
There is also the problem that premium rises are restricted by the government, and premium rises have been below inflation – the 2024 premium rise was 3.03% on average while other insurance products went up in the mid-teens. The government approved a rise of just below 4% for 2025, but this may not be enough for the industry to see the rising margins it has desired.
At its FY24 results, Medibank told investors industry growth would moderate this year, but the industry would stabilise in FY26 and the company would increase its market share.
Is Medibank Private a Good Stock to Buy?
We think it has potential. It is a consistent dividend payer and has a track record of policyholder growth ever since it listed on the ASX. But, we would wait another 12 months or so when the industry is expected to stabilise.
Our Stock Analysis
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Frequently Asked Questions
Medibank, established in 1976 and privatized in 2014, is Australia's largest health insurer, covering ~4m million Australians. It provides private health insurance policies and integrated healthcare services, aiming to create a healthier future for all Australians.