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Clover Health Investments (CLOV)
NASDAQ:CLOV
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Clover Health Investments
(NASDAQ:CLOV)
46Neutral
Positive Factors
Earnings
CLOV reported adjusted EBITDA of $19.3 million, exceeding estimates and raising the low-end of its guidance range.
Membership Growth
Impressively, Clover highlighted that it expects average MA membership growth of 30% in 2025 to 103,000 to 107,000 members based on its AEP efforts.
Technology Impact
Clover Health's Clover Assistant, which utilizes AI and ML, is changing the way patients are treated, reducing the cost of care, and ultimately leading to greater cash flow and earnings for CLOV shareholders.
Negative Factors
Expense Increase
BER is expected to be 87-88% in 2025 vs. 81.2% in 2024, indicating increased expenses.
Guidance Concerns
Shares are down after the 3Q report, likely as the updated guidance implies 4Q adj-EBITDA may swing negative.
Revenue Performance
Reported revenues of $337 million missed consensus and our estimate by 2.9% and 2.0%, respectively.
Clover Health Investments (CLOV) vs. S&P 500 (SPY)
Market Cap
$1.87B
Dividend YieldN/A
Average Volume (3M)6.01M
Price to Earnings (P/E)―
Beta (1Y)1.79
Revenue Growth-32.45%
EPS Growth80.24%
CountryUS
Employees552
SectorHealthcare
Sector Strength76
IndustryMedical Service Plans
Share Statistics
EPS (TTM)-0.09
Shares Outstanding418,531,700
10 Day Avg. Volume7,201,818
30 Day Avg. Volume6,008,338
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.36
Price to Cash Flow (P/CF)-5.50
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$4.75Price Target Upside28.38% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
Clover Health Investments Business Overview & Revenue Model
Company DescriptionClover Health Investments Corp is a healthcare technology company. It uses its proprietary technology platform to collect, structure, and analyze health and behavioral data to improve medical outcomes and lower costs for patients.
How the Company Makes MoneyClover Health makes money primarily through its Medicare Advantage plans, where it receives a fixed monthly payment from the Centers for Medicare & Medicaid Services (CMS) for each enrolled member. This payment is used to cover healthcare costs for members, allowing Clover to profit from efficiently managing these costs through improved care and preventative measures. The company's revenue model is heavily reliant on its ability to reduce medical expenses through data-driven insights provided by the Clover Assistant, which aims to optimize treatment plans and improve patient outcomes. Significant partnerships with healthcare providers and a focus on expanding its member base within the Medicare Advantage market are key factors contributing to its earnings.
Clover Health Investments Financial Statement Overview
Summary
Clover Health Investments shows signs of improvement in cash flow and equity position, but continues to face challenges in revenue growth and profitability. The income statement highlights ongoing struggles with negative margins, while the balance sheet demonstrates a stronger equity position with zero debt. Despite these improvements, the company must address its revenue decline and work towards achieving profitability for long-term financial health.Income Statement
Clover Health Investments has faced declining revenue trends, with a notable drop from $3.47 billion in 2022 to $1.37 billion in 2024. The company has consistently reported negative net income and EBIT margins, indicating ongoing profitability challenges. The net profit margin remains negative, further emphasizing financial struggles, despite a slight improvement in gross profit margin from 2023 to 2024.30
Negative
Balance Sheet
The balance sheet shows some positive aspects with a debt-free position by 2024 and improving stockholders' equity. However, the equity ratio is moderate at approximately 58.7%, and the historical negative equity in 2020 indicates past financial instability. The return on equity remains negative due to persistent net losses.40
Negative
Cash Flow
The cash flow statement reveals a significant turnaround in operating cash flow from negative $115.87 million in 2023 to positive $82.45 million in 2024, resulting in positive free cash flow. However, the company's history of negative free cash flow raises concerns about sustainable cash generation.45
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.37B | 1.26B | 3.48B | 1.47B | 672.89M | Gross Profit |
| 364.80M | 255.95M | 22.73M | -79.18M | 82.42M | EBIT |
| -45.75M | -205.33M | -370.92M | -636.99M | -92.71M | EBITDA |
| -44.94M | -207.63M | -337.02M | -569.60M | -78.73M | Net Income Common Stockholders |
| -43.01M | -213.36M | -305.40M | -604.67M | -148.69M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 221.54M | 242.69M | 555.29M | 791.19M | 151.10M | Total Assets |
| 580.74M | 570.67M | 808.62M | 950.80M | 267.25M | Total Debt |
| 0.00 | 4.66M | 5.86M | 27.83M | 806.21K | Net Debt |
| -194.54M | -118.20M | -97.93M | -272.14M | -27.20M | Total Liabilities |
| 239.60M | 284.28M | 460.88M | 411.49M | 835.63M | Stockholders Equity |
| 341.14M | 286.39M | 347.74M | 539.32M | -568.38M |
| Cash Flow | Free Cash Flow | |||
| 33.29M | -116.45M | -208.39M | -283.05M | -2.92M | Operating Cash Flow |
| 34.84M | -115.87M | -203.93M | -282.33M | -2.23M | Investing Cash Flow |
| 565.00K | 140.01M | 95.13M | -435.45M | -828.00M | Financing Cash Flow |
| -17.36M | -33.86M | -4.96M | 925.39M | 858.23M |
Clover Health Investments Technical Analysis
Neutral
3.70
Price Trends
4.07
Negative
3.78
Negative
3.02
Positive
Market Momentum
-0.18
Positive
44.31
Neutral
55.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CLOV, the sentiment is Neutral. The current price of 3.7 is below the 20-day moving average (MA) of 3.92, below the 50-day MA of 4.07, and above the 200-day MA of 3.02, indicating a neutral trend. The MACD of -0.18 indicates Positive momentum. The RSI at 44.31 is Neutral, neither overbought nor oversold. The STOCH value of 55.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CLOV.
Clover Health Investments Risk Analysis
Clover Health Investments disclosed 66 risk factors in its most recent earnings report. Clover Health Investments reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Clover Health Investments Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $28.86B | 9.48 | 12.65% | ― | 5.89% | 27.09% | |
69 Neutral | $3.31B | ― | 2.80% | ― | 56.54% | ― | |
67 Neutral | $30.52B | 25.32 | 7.40% | 1.40% | 10.70% | -49.85% | |
49 Neutral | $6.86B | 0.01 | -55.93% | 2.48% | 24.36% | -2.88% | |
46 Neutral | $1.87B | ― | -14.75% | ― | -32.45% | 80.24% | |
45 Neutral | $1.50B | ― | -52.46% | ― | -1.26% | -338.56% | |
43 Neutral | $124.26M | ― | -54.13% | ― | -1.81% | 70.88% |
* Healthcare Sector Average
Performance Comparison
CLOV
Clover Health Investments
3.70
2.88
351.22%
CNC
Centene
59.24
-19.46
-24.73%
HUM
Humana
264.41
-83.25
-23.95%
TDOC
Teladoc
8.87
-6.16
-40.98%
AMWL
American Well
8.20
-9.04
-52.44%
OSCR
Oscar Health
13.45
-0.35
-2.54%
Clover Health Investments Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -10.63% | Next Earnings Date: May 13, 2025
Earnings Call Sentiment Positive
The earnings call highlighted several strong achievements, such as achieving profitability, significant membership growth, and improved star ratings. However, there were concerns regarding increased SG&A expenses and the impact of minimum MLR rebates on revenue. Overall, the positive aspects outweighed the challenges.Highlights
Achieved Adjusted EBITDA Profitability
Clover Health achieved full year adjusted EBITDA profitability in 2024, marking a significant milestone in its financial performance.
Medicare Advantage Membership Growth
The company surpassed 100,000 Medicare Advantage members during AEP, reflecting a 27% year-over-year growth and a 95% AEP retention rate.
Improved Star Ratings
Over 95% of members are now in four-star rated PPO plans, with nation-leading clinical measures, setting the stage for higher benchmarks in 2026.
Counterpart Health Launch
Successfully launched Counterpart Health, implementing first external partnerships and establishing a pipeline of potential customers.
Revenue Growth
Insurance revenue grew 9% year-over-year in both the fourth quarter and full year 2024, reaching $1,345 million.
Improved Benefit Expense Ratio and MCR
Insurance benefit expense ratio improved to 82.8% and MCR to 73.5% in Q4 2024, showing strong improvements year-over-year.
Strong Financial Position
Ended Q4 2024 with $438 million in restricted and unrestricted cash and investments, providing a strong balance sheet position.
Lowlights
Higher SG&A Expenses
SG&A expenses increased by 7% year-over-year in Q4 2024 due to strategic investments, impacting overall profitability.
Minimum MLR Rebate Impact
The strong MA plan margin performance resulted in an immaterial minimum MLR rebate in 2024, effectively lowering revenues.
Company Guidance
During the Clover Health fourth quarter and full-year 2024 earnings call, the company provided several key metrics and guidance for the future. Clover Health reported a meaningful full-year adjusted EBITDA profitability and surpassed 100,000 Medicare Advantage members during the annual enrollment period (AEP), reflecting a 27% year-over-year growth and a 95% retention rate. The company also improved its star ratings, with over 95% of members in four-star rated plans. For 2025, Clover Health expects insurance revenue between $1.8 billion and $1.875 billion, driven by a 30% growth in average Medicare Advantage membership, expected to range between 103,000 and 107,000 members. The guidance also includes adjusted SG&A between $355 million and $365 million, and adjusted EBITDA between $45 million and $70 million. Additionally, Clover Health highlighted its successful launch of Counterpart Health, its software business, and plans to invest in expanding its home care services and Clover Assistant technology.Clover Health Investments Corporate Events
Business Operations and Strategy
Clover Health Sees 27% Growth in Medicare Members
Positive
Jan 13, 2025
Clover Health announced a significant 27% growth in its Medicare Advantage membership following a successful Annual Election Period, reaching over 100,000 members, with 95% enrolled in its 4-Star PPO plan. This growth, driven by robust plan benefits and a high Star rating, positions the company for continued success and profitability in 2025, supported by strategic investments in technology and care management improvements. The strong membership increase and anticipated payment increases in 2026 reflect Clover’s strong market positioning and commitment to enhancing healthcare quality.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.