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eHealth (EHTH) Q2 Loss Wider Than Expected, '17 View Intact

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eHealth Inc. (EHTH - Free Report) reported second-quarter 2017 adjusted net loss of 93 cents per share, wider than the Zacks Consensus Estimate of a loss of 75 cents and the year-ago loss of 3 cents.

Revenues declined at Individual, Family and Small Business segment but improved at Medicare. Though estimated memberships increased, approved members declined in the quarter. Expenses increased as well.

 

eHealth, Inc. Price, Consensus and EPS Surprise

Operational Update

eHealth’s total revenue amounted to $27.9 million, missing the Zacks Consensus Estimate of $29 million and decreasing 25% year over year. Lower Individual, Family and Small Business revenues largely accounted for the decline.

Total operating costs and expenses rose 5% year over year to $45.1 million.

Operating margin for the reported quarter was (62) % compared with (16) % in the year-ago quarter.

Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) were $(13.6) million compared with $(2.6) million in the year-ago quarter.

Total estimated membership for eHealth as of Jun 30, 2017 was nearly 0.9 million, down 19% year over year. Total approved members increased 26% year over year to 0.3 million from the prior-year quarter.

Financial Update

Cash and cash equivalents for eHealth as of Jun 30, 2017 were $66 million, 7% up from $61.7 million at year-end 2016. The increase was attributable to lower cash used in operating activities.

The company’s total assets as of Jun 30, 2017 were approximately $121.6 million, up from $108.8 million as of Dec 31, 2016.

As of Jun 30, 2017, total stockholders’ equity of eHealth was approximately $98 million compared with $77.6 million as of Dec 31, 2016.

Net cash used in operating activities was $1 million compared with $2.6 million generated in the prior-year quarter.

2017 Guidance Reiterated

The company expects to generate revenues in the range of $165 million to $175 million. It expects the Medicare Segment to generate revenues in the range of $96.5 million to $101.5 million. The Individual, Family and Small Business Segment are expected to generate revenues in the range of $68.5 million to $73.5 million.

Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) is expected to be in the range of ($14.1) million to $(16.1) million. The Medicare segment loss is expected to be in the range of $(11.5) million to $(12.5) million, whereas, profit from the Individual, Family and Small Business segment is expected in the range of $23.5 million to $24.5 million.

It expects GAAP net loss in the range of $1.49 to $1.59 per share and non-GAAP net loss per share of 86 cents to 96 cents.

Zacks Rank

Presently, eHealth carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

Among other players from the insurance industry that have reported their second-quarter earnings so far, the bottom line at Brown & Brown, Inc. (BRO - Free Report) and Fidelity National Financial, Inc. (FNF - Free Report) beat their respective Zacks Consensus Estimates, while The Progressive Corporation (PGR - Free Report) missed the same.

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