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Here's Why You Should Retain CLOV Stock in Your Portfolio Now
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Key Takeaways
CLOV is gaining share with 35% membership growth and nearly 50% revenue growth, backed by retention above 90%.
CLOV sees higher margins as Clover Assistant drives profits and improves cost ratios for returning members.
CLOV expands monetization through Counterpart Health, extending its platform beyond Medicare Advantage plans.
Clover Health Investments (CLOV - Free Report) is well poised for growth in the coming quarters, courtesy of its broad product spectrum. This optimism is primarily driven by its technology-first care model, as evident from solid membership growth, rising revenues and sustained adjusted EBITDA profitability.However, elevated medical costs, margin pressure and execution risks in scaling Clover Assistant present near-term challenges.
Shares of this Zacks Rank #3 (Hold) company have lost 12.5% over the past six months compared with the industry’s 16.3% decline. The S&P 500 Index has increased 16.3% in the same time frame.
Clover Health, a tech-enabled Medicare Advantage insurer leveraging its proprietary AI-powered platform, has a market capitalization of $1.36 billion. The company projects a 350% earnings decline for the fourth quarter of 2025. However, earnings are expected to return to growth in 2026.
Image Source: Zacks Investment Research
Its earnings surpassed estimates in two of the trailing four quarters, missed in one and met in the other, delivering an average surprise of 50.00%.
Factors Favoring CLOV Stock
Clover Assistant Drives Strong Cohort Economics: Clover Assistant remains the key element of Clover Health’s economic model, clearly differentiating the company from traditional Medicare Advantage peers. Management highlighted that returning members managed under Clover Assistant generate approximately $217 in contribution profit per member per month compared to a loss of about $110 for first-year members.
This stark contrast underscores the cohort-driven nature of the business. Importantly, Clover’s internal data shows roughly 700 basis points of medical cost ratio improvement from year one to year two, expanding to 1,400 basis points by year three, reinforcing confidence in long-term margin expansion as cohorts mature.
Above-Market Membership Growth With Industry-Leading Retention: Clover is gaining share at a time when many competitors are pulling back, delivering 35% year-over-year membership growth and nearly 50% revenue growth in the third quarter of 2025. This growth has been driven in part by market disruption, as rivals reduced benefits or exited geographies. Crucially, Clover has maintained retention above 90%, signaling that growth is not coming at the expense of member stickiness. Management views 2025 as a transitional year marked by first-year cohort dilution, with 2026 shaping up as an inflection point when a larger base of profitable returning members begins to dominate results.
Counterpart Health Expands Monetization Optionality: Counterpart Health represents a strategic extension of Clover Assistant beyond Clover’s owned Medicare Advantage plans. The platform targets smaller, independent physicians who lack the infrastructure to succeed in value-based care — an area management describes as a “blue ocean” opportunity.
During the quarter, Clover expanded Counterpart’s enterprise capabilities and go-to-market resources, citing early traction with provider groups and payers. Over time, Counterpart could evolve into a scalable, software-enabled revenue stream, diversifying Clover’s earnings profile and allowing the company to monetize its core technology well beyond its MA membership base.
Key Challenges
Near-Term Margin Compression From New Member Mix: Clover’s aggressive growth strategy has come with a clear short-term tradeoff. A higher-than-expected mix of first-year members —who carry elevated medical costs, marketing expenses and commissions — has pressured profitability.
While returning cohorts remain profitable, the dilution from new members forced management to lower full-year 2025 adjusted EBITDA guidance, even as the company stays profitable year to date. Management emphasized that this dynamic is structural rather than cyclical, framing 2025 as the peak year of cohort drag. Execution risk remains around how quickly new members are brought under full Clover Assistant management.
Elevated Medical Utilization Across Services: Clover saw increased utilization across both inpatient and outpatient services in the third quarter, particularly in oncology, cardiac, and surgical procedures.Management characterized these trends as consistent with broader industry patterns, rather than company-specific missteps. Still, utilization volatility materially impacted medical costs and weighed on margins in the third quarter.
While Clover believes these pressures are now reflected in updated guidance and 2026 bids, utilization remains a critical swing factor. Any persistence of elevated trends could delay the expected margin recovery tied to cohort maturation, making medical cost management a central execution priority heading into 2026.
Star Ratings Underperformance and Pharmacy Weakness: Clover received a 3.5-star rating for the 2026 payment year, falling short of management’s stated goal of achieving 4 stars. While the company argues its model can remain profitable even at 3.5 stars, the lower rating limits near-term reimbursement upside.
Management pointed specifically to weak performance in pharmacy-related measures, which offset strong clinical quality results, including industry-leading HEDIS scores. Improving pharmacy execution is now a key focus area. Closing this gap is critical, as sustained 4-star performance would meaningfully enhance margins and strengthen Clover’s competitive positioning.
Clover is witnessing a stable estimate revision trend for 2025. In the past 30 days, the Zacks Consensus Estimate for earnings has remained stable at 4 cents per share.
The Zacks Consensus Estimate for fourth-quarter 2025 revenues and loss per share is pegged at $472.5 million and 5 cents, respectively.
Stocks to Consider
Some better-ranked stocks in the broader medical space that have announced quarterly results are Medpace Holdings, Inc. (MEDP - Free Report) , CareCloud and KORU Medical Systems (KRMD - Free Report) .
Medpace Holdings, currently carrying a Zacks Rank #2 (Buy), reported second-quarter 2025 EPS of $3.10, which beat the Zacks Consensus Estimate by 3.3%. Revenues of $603.3 million outpaced the consensus mark by 11.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Medpace Holdings has a long-term estimated growth rate of 11.4%. MEDP’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 13.9%.
CareCloud reported third-quarter 2025 adjusted EPS of 10 cents, which beat the Zacks Consensus Estimate by 25%. Revenues of $31 million surpassed the Zacks Consensus Estimate by 8.3%. It currently carries a Zacks Rank of 2.
CareCloud has an estimated growth rate of 20% for 2025. CCLD’s earnings surpassed estimates in two of the trailing four quarters and missed twice, the average negative surprise being 2.88%.
KORU Medical Systems reported third-quarter 2025 adjusted loss per share of 2 cents, narrower than the Zacks Consensus Estimate of loss by 33.3%. Revenues of $10 million surpassed the Zacks Consensus Estimate by 7.1%. It currently carries a Zacks Rank #2.
KORU Medical Systems has an estimated growth rate of 83.3% for 2026. KRMD’s earnings surpassed estimates in two of the trailing four quarters, missed in one and met in the other, the average surprise being 20.83%.
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Here's Why You Should Retain CLOV Stock in Your Portfolio Now
Key Takeaways
Clover Health Investments (CLOV - Free Report) is well poised for growth in the coming quarters, courtesy of its broad product spectrum. This optimism is primarily driven by its technology-first care model, as evident from solid membership growth, rising revenues and sustained adjusted EBITDA profitability.However, elevated medical costs, margin pressure and execution risks in scaling Clover Assistant present near-term challenges.
Shares of this Zacks Rank #3 (Hold) company have lost 12.5% over the past six months compared with the industry’s 16.3% decline. The S&P 500 Index has increased 16.3% in the same time frame.
Clover Health, a tech-enabled Medicare Advantage insurer leveraging its proprietary AI-powered platform, has a market capitalization of $1.36 billion. The company projects a 350% earnings decline for the fourth quarter of 2025. However, earnings are expected to return to growth in 2026.
Image Source: Zacks Investment Research
Its earnings surpassed estimates in two of the trailing four quarters, missed in one and met in the other, delivering an average surprise of 50.00%.
Factors Favoring CLOV Stock
Clover Assistant Drives Strong Cohort Economics: Clover Assistant remains the key element of Clover Health’s economic model, clearly differentiating the company from traditional Medicare Advantage peers. Management highlighted that returning members managed under Clover Assistant generate approximately $217 in contribution profit per member per month compared to a loss of about $110 for first-year members.
This stark contrast underscores the cohort-driven nature of the business. Importantly, Clover’s internal data shows roughly 700 basis points of medical cost ratio improvement from year one to year two, expanding to 1,400 basis points by year three, reinforcing confidence in long-term margin expansion as cohorts mature.
Above-Market Membership Growth With Industry-Leading Retention: Clover is gaining share at a time when many competitors are pulling back, delivering 35% year-over-year membership growth and nearly 50% revenue growth in the third quarter of 2025. This growth has been driven in part by market disruption, as rivals reduced benefits or exited geographies. Crucially, Clover has maintained retention above 90%, signaling that growth is not coming at the expense of member stickiness. Management views 2025 as a transitional year marked by first-year cohort dilution, with 2026 shaping up as an inflection point when a larger base of profitable returning members begins to dominate results.
Counterpart Health Expands Monetization Optionality: Counterpart Health represents a strategic extension of Clover Assistant beyond Clover’s owned Medicare Advantage plans. The platform targets smaller, independent physicians who lack the infrastructure to succeed in value-based care — an area management describes as a “blue ocean” opportunity.
During the quarter, Clover expanded Counterpart’s enterprise capabilities and go-to-market resources, citing early traction with provider groups and payers. Over time, Counterpart could evolve into a scalable, software-enabled revenue stream, diversifying Clover’s earnings profile and allowing the company to monetize its core technology well beyond its MA membership base.
Key Challenges
Near-Term Margin Compression From New Member Mix: Clover’s aggressive growth strategy has come with a clear short-term tradeoff. A higher-than-expected mix of first-year members —who carry elevated medical costs, marketing expenses and commissions — has pressured profitability.
While returning cohorts remain profitable, the dilution from new members forced management to lower full-year 2025 adjusted EBITDA guidance, even as the company stays profitable year to date. Management emphasized that this dynamic is structural rather than cyclical, framing 2025 as the peak year of cohort drag. Execution risk remains around how quickly new members are brought under full Clover Assistant management.
Elevated Medical Utilization Across Services: Clover saw increased utilization across both inpatient and outpatient services in the third quarter, particularly in oncology, cardiac, and surgical procedures.Management characterized these trends as consistent with broader industry patterns, rather than company-specific missteps. Still, utilization volatility materially impacted medical costs and weighed on margins in the third quarter.
While Clover believes these pressures are now reflected in updated guidance and 2026 bids, utilization remains a critical swing factor. Any persistence of elevated trends could delay the expected margin recovery tied to cohort maturation, making medical cost management a central execution priority heading into 2026.
Star Ratings Underperformance and Pharmacy Weakness: Clover received a 3.5-star rating for the 2026 payment year, falling short of management’s stated goal of achieving 4 stars. While the company argues its model can remain profitable even at 3.5 stars, the lower rating limits near-term reimbursement upside.
Management pointed specifically to weak performance in pharmacy-related measures, which offset strong clinical quality results, including industry-leading HEDIS scores. Improving pharmacy execution is now a key focus area. Closing this gap is critical, as sustained 4-star performance would meaningfully enhance margins and strengthen Clover’s competitive positioning.
Clover Health Investments, Corp. Price
Clover Health Investments, Corp. price | Clover Health Investments, Corp. Quote
Estimate Trend
Clover is witnessing a stable estimate revision trend for 2025. In the past 30 days, the Zacks Consensus Estimate for earnings has remained stable at 4 cents per share.
The Zacks Consensus Estimate for fourth-quarter 2025 revenues and loss per share is pegged at $472.5 million and 5 cents, respectively.
Stocks to Consider
Some better-ranked stocks in the broader medical space that have announced quarterly results are Medpace Holdings, Inc. (MEDP - Free Report) , CareCloud and KORU Medical Systems (KRMD - Free Report) .
Medpace Holdings, currently carrying a Zacks Rank #2 (Buy), reported second-quarter 2025 EPS of $3.10, which beat the Zacks Consensus Estimate by 3.3%. Revenues of $603.3 million outpaced the consensus mark by 11.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Medpace Holdings has a long-term estimated growth rate of 11.4%. MEDP’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 13.9%.
CareCloud reported third-quarter 2025 adjusted EPS of 10 cents, which beat the Zacks Consensus Estimate by 25%. Revenues of $31 million surpassed the Zacks Consensus Estimate by 8.3%. It currently carries a Zacks Rank of 2.
CareCloud has an estimated growth rate of 20% for 2025. CCLD’s earnings surpassed estimates in two of the trailing four quarters and missed twice, the average negative surprise being 2.88%.
KORU Medical Systems reported third-quarter 2025 adjusted loss per share of 2 cents, narrower than the Zacks Consensus Estimate of loss by 33.3%. Revenues of $10 million surpassed the Zacks Consensus Estimate by 7.1%. It currently carries a Zacks Rank #2.
KORU Medical Systems has an estimated growth rate of 83.3% for 2026. KRMD’s earnings surpassed estimates in two of the trailing four quarters, missed in one and met in the other, the average surprise being 20.83%.