Providing an update on its metrics, next-generation healthcare company Clover Health (CLOV) has announced that it expects total Lives under Clover Management to rise about 60% to over 200,000 in 2022. Notably, the figure stood at 129,100 as of September 30, 2021.
Additionally, the company anticipates its average number of Direct Contracting aligned lives to double from current levels to 125,000 in 2022.
Recently, Clover Health posted upbeat revenues for the third quarter of 2021. Total revenues of $427.2 million surpassed analysts’ expectations of $417.8 million and more than doubled on a year-over-year basis. The company recorded a normalized Medicare Advantage (MA) Medical Care Ratio (MCR) of 94.8%, as compared to 96.4% in the same quarter last year. (See Clover Health stock charts on TipRanks)
For 2021, the company projects total revenues to be in the range of $1.42 billion to $1.47 billion. Normalized MA MCR is expected to be in the range of 94% to 96%. Additionally, normalized adjusted EBITDA loss is forecast to be between $250 million and $230 million.
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Analysts Recommendation
In September, Cowen & Co. analyst Gary Taylor initiated coverage of the stock with a Sell rating and a price target of $7 (2.2% downside potential).
Taylor is skeptical regarding the company’s core business thesis that its Clover Assistant and the unmanaged FFS physician practices will result in best-in-class care management and per-capita medical costs.
Overall, the Street is bearish on the stock and has a Moderate Sell consensus rating based on 1 Hold and 1 Sell. The average Clover Health price target of $8.50 implies 18.72% upside potential to current levels. Shares have declined 28.3% over the past year.
Risk Analysis
According to the new TipRanks’ Risk Factors tool, the Clover Health stock is at risk mainly from two factors: Finance and Corporate, and Legal and Regulatory, which contribute 49% and 14%, respectively, to the total 65 risks identified for the stock.
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