Anthem, Inc. ANTM has been suffering escalating operating expenses and the COVID-19 uncertainties.Over the past 30 days, the company has witnessed its 2021 and 2022 estimates move 1.2% and 1.4%, south, respectively. This reflects investors' pessimism on the stock.Return on equity (ROE) of a company reflects its growth potential. Anthem’s ROE undermines the same. The company’s trailing 12-month ROE stands at 17.2%, comparing unfavorably with the industry average of 21.7%, indicating that it is less efficient in utilizing its shareholders’ funds.Its Commercial & Specialty Business has also been witnessing weak performance lately. The segment came up with poor operating results due to costs associated with actions taken to support members and providers in response to the prevalent pandemic scenario. In 2020, operating gains in the segment declined 33.5% year over year.Moreover, the health insurer has been enduring high expenses over the past few years, primarily caused by an increasing benefit expense along with selling, general and administrative (SG&A) expense. Escalating level of expenses continues to drain the bottom line. Anthem's total expenses inched up 1.2% and 15.2% during 2018 and 2019, respectively.In 2020, total expenses rose 17.7% year over year. This constant rise in expense might weigh down its margins going forward. Given the current situation, the company is likely to be persistently hurt by an elevated expense level.The company’s solvency level also bothers. Its net debt accounts for 27.2% of its capital, higher than the industry’s average of 19.7%. Its cash and cash equivalents of $5.7 billion as of Dec 31, 2020 are much lower than the long-term debt of $19 billion. In fact, its times interest earned of 9X is way lower than its industry's average of 11.4X. Thus, a high debt and low interest coverage raise concerns.Shares of this presently Zacks Rank #4 (Sell) company have gained 62.6% in a year’s time, outperforming its industry’s growth of 48.6%. However, headwinds facing the company will likely keep the stock under pressure going forward.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Other companies in the same space, such as Humana Inc. HUM, Centene Corporation CNC and Select Medical Holdings Corporation SEM have also rallied 35.4%, 11% and 125.3%, respectively, in the same time frame.Breakout Biotech Stocks with Triple-Digit Profit PotentialThe biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.See these 7 breakthrough stocks now>> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Humana Inc. (HUM): Free Stock Analysis Report Centene Corporation (CNC): Free Stock Analysis Report Select Medical Holdings Corporation (SEM): Free Stock Analysis Report Anthem, Inc. (ANTM): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research