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eHealth (EHTH) Q4 Loss Narrower Than Expected, View Revised

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eHealth Inc. (EHTH - Free Report) reported fourth-quarter 2017 adjusted net loss of 93 cents per share, narrower than the Zacks Consensus Estimate of a loss of $1.09. The figure was however, wider than the loss of 79 cents incurred a year ago.

eHealth, Inc. Price, Consensus and EPS Surprise


Revenues declined at Individual, Family and Small Business segment but improved at Medicare. Estimated memberships decreased in the period. Expenses increased as well.

Operational Update

eHealth’s total revenues amounted to $38.8 million, marginally beating the Zacks Consensus Estimate of $38 million. Also, the top line is down 11% year over year due to lower Individual, Family and Small Business revenues.

Total operating costs and expenses rose 2.7% year over year to $62.2 million.

Operating margin for the reported quarter was (51%) compared with (33%) in the year-earlier period.

Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) were ($19.1) million compared with ($13.9) million a year ago.

Total estimated membership for eHealth as of Dec 31, 2017 was nearly 0.9 million, down 8% year over year. Of this, estimated Medicare membership increased 26% but individual and family plan membership declined 38%.  

Full-Year Highlights

eHealth incurred adjusted net loss of 76 cents per share, comparing unfavorably with 17 cents earned in 2016.

Revenues of $172.4 million fell 7.8% from the level in 2016.

Financial Update

Cash and cash equivalents for eHealth as of Dec 31, 2017 were $40.3 million, down nearly 35% from $61.7 million at year-end 2016.

The company’s total assets as of Dec 31, 2017 were approximately $88.7 million, down from $108.8 million as of Dec 31, 2016.

As of Dec 31, 2017, total stockholders’ equity of eHealth was approximately $61.1 million compared with $77.6 million as of Dec 31, 2016.

Net cash used in operating activities was $15.5 million in 2017 compared with $4.1 million generated in 2016.

2018 Guidance

The company expects to generate revenues in the range of $217.5-$227.5 million with the Medicare Segment to record the same within $178.5-$183.5 million. The Individual, Family and Small Business Segment is projected to gross revenues in the band of $39-$44 million.

Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) are anticipated in the range of $21.-$26.9 million. The Medicare segment profit is estimated within $45.5-$49.5 million whereas profit from the Individual, Family and Small Business segment is predicted between $6 million and $7 million.

The company expects non-GAAP net income per share of 92 cents to $1.18. Adjusted EBITDA  is forecast between $1.13 and $1.39.

Zacks Rank

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 Insurance Brokers

Among other players from the insurance industry that have reported fourth-quarter earnings, the bottom line of Brown & Brown, Inc. (BRO - Free Report) , Arthur J. Gallagher & Co. (AJG - Free Report) and Marsh & McLennan Companies, Inc. (MMC - Free Report) beat the respective Zacks Consensus Estimate.

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