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eHealth (EHTH) to Report Q3 Earnings: Is a Beat in Store?

Zacks.com logo Zacks.com 10/19/2020

eHealth EHTH is slated to report third-quarter 2020 results on Oct 22, after market close. The company delivered earnings surprise of 138.89% in the last reported quarter.

Factors to Consider

eHealth’s third-quarter results are likely to be driven by better performances at its Medicare as well as individual and family plan (IFP) business.

The company’s investments in Medicare-related marketing initiatives and expansion of telesales capacity and online sales capability are expected to have driven the performance of the Medicare segment. Medicare enrollment continues to grow as the company caters to solid demand via its omni-channel consumer engagement platform. The Zacks Consensus Estimate for segment revenues is pegged at $79 million, indicating an increase of 36.8% from the year-ago reported number.

However, the company expects soft third-quarter Medicare enrollment volumes due to seasonality and thus estimates sequential decline in revenues. The Zacks Consensus Estimate for the number of approved members at the Medicare segment is pegged at 69,486 for the to-be-reported quarter, suggesting an increase of 35.7% from the prior quarter but a 0.2% sequential decline.

The company’s individual and family plan (IFP) business is likely to have performed well and benefited from estimated lifetime values of individual and family plan members. The Zacks Consensus Estimate for the number of approved members at the IFP segment is pegged at 4,686, indicating an increase of 47% from the year-ago reported number.

eHealth expects increase in third-quarter expenses, attributable to higher customer care enrollment expense as it ramps up agent hiring and training ahead of the fourth quarter annual enrollment period.

The Zacks Consensus Estimate for third-quarter 2020 earnings implies a decline of 25.6% year over year.

eHealth, Inc. Price and EPS Surprise

  chart, line chart: eHealth, Inc. Price and EPS Surprise © Provided by Zacks.com eHealth, Inc. Price and EPS Surprise

eHealth, Inc. price-eps-surprise | eHealth, Inc. Quote

What the Zacks Model Says

Our proven model predicts an earnings beat for eHealth this time around. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).

Earnings ESP: eHealth has an Earnings ESP of +20.96%. This is because the Most Accurate Estimate of loss of 43 cents is narrower than the Zacks Consensus Estimate of a loss of 54 cents. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: eHealth currently carries a Zacks Rank of 3.

Other Stocks to Consider

Some insurance stocks also with the right combination of elements to come up with an earnings beat this time around are:

Arthur J. Gallagher AJG has an Earnings ESP of +1.00% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Marsh McLennan MMC has an Earnings ESP of +7.03% and a Zacks Rank #3.

Brown Brown BRO has an Earnings ESP of +6.13% and a Zacks Rank of 3.

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