eHealth spends on increased demand, guides below the Street


eHealth (EHTH) is out with preliminary results for Q4 and FY13.

FY13: Revenue seen at $178-180M (guidance was $168-174M). Non-GAAP EPS seen at $0.34-0.41 (guidance was $0.61-0.71).

Q4: Revenue seen at $53-55M. Non-GAAP EPS seen at -$0.03 to $0.04. Consensus is $0.21.

Here's CEO Gary Lauer, explaining: "We experienced a significant increase in demand for our Individual & Family Plan product during Q4's Open Enrollment Period under the ACA and made the decision to spend into the increased demand and pursue longer-term growth at the expense of Q4 earnings." (PR)

EHTH +4.9% AH

Comments (3)
  • The Deep Value Investor
    , contributor
    Comments (299) | Send Message
     
    BS, what that plick isnt saying is the fact they had high sales volume in the 4th Q of 2013 because those were people applying for health insurance before Obamacare was to take effect on Jan 1 2014 since the options were much greater and the cost is much less than ACA plans. EHTH is going to crash and burn in 2014. I own a health insurance agency and everyone in health insurance is getting killed by ACA and clients are stuck with limited options and higher costs now that ACA took effect. Commissions for individual and group health insurance were cut by 60 to 85% in Oct of 2010, and at the same time due to ACA clients premiums jumped up much higher than normal. Many of the carriers I have used in the past that EHTH uses have gone to a direct model where they do not allow any compensation to people signing up for their health policies on the exchange (or on going commission payments for existing clients effective Jan 1, 2014). Short the hell out of EHTH and buy puts cause this stock is going to fall to the ground.
    8 Jan 2014, 11:23 PM Reply Like
  • ECHealthInsurance
    , contributor
    Comments (15) | Send Message
     
    You couldn't be more correct. I am a partner in East Coast Health Insurance and our model is at best unpredictable after 4/1. Besides qualifying events and short term we are gonna diddle our thumbs till the next 45 day open enrollment in October/November (45 days next year). Wait till ehealth's earnings come out for q2 and q3 next year. It will be a blood bath. You can't compete with the US government!
    30 Jan 2014, 11:09 AM Reply Like
  • The Deep Value Investor
    , contributor
    Comments (299) | Send Message
     
    Yup, we were spot on. Not a surprise. EHTH is worth about $1 in my opinion.
    15 Jan 2015, 06:36 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs