Why eHealth Inc. Shares Vaulted Higher

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of eHealth (NASDAQ: EHTH  ) , a provider of online private health insurance services for individuals, families, and small businesses, jumped as much as 25% after announcing its preliminary results for the fourth-quarter yesterday following the closing bell.

So what: For the fourth-quarter, eHealth anticipates reporting revenue in a range of $53 million to $55 million – significantly higher than the $49.2 million Wall Street consensus – as individual and family plan product demand increased approximately 50% year-over-year. However, due to much higher marketing costs, eHealth anticipates its fourth-quarter bottom-line will range from a loss of $0.03 to a profit of $0.04. For the full-year, eHealth is forecasting EPS in a range of $0.34-$0.41 which is more or less in-line with Wall Street's expectation of $0.36.

Now what: In spite of higher marketing costs negatively impacting eHealth's profitability, what we're seeing here is the direct result of the problems associated with the website. With the individual mandate requiring individuals to purchase health insurance by law in 2014 or face a penalty, and Obamacare's federally run health exchange,, running into numerous issues over its first two months, eHealth has turned into a big beneficiary. By offering a similar private insurance platform where individuals can compare plans, eHealth has very stealthily given consumers a way to circumvent Obamacare's exchanges while still gaining access to health insurance. As we approach the ever-important March 31 coverage cutoff date, I would anticipate eHealth's product demand will only increase.

With Obamacare now implemented, are you prepared? If not, let us help get you up to speed! 
Obamacare seems complex, but it doesn't have to be. In only minutes, you can learn the critical facts you need to know in a special free report called Everything You Need to Know About Obamacare. This FREE guide contains the key information and money-making advice that every American must know. Please click here to access your free copy.

Read/Post Comments (1) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 09, 2014, at 2:41 PM, stonewall53 wrote:

    Web based brokers ehealthinsurance and gohealthinsurance signed up thousands of new applicants knowing that they could not offer subsidies at their respective websites. What happens when those consumers find out that they are paying thousands of dollars more in premiums than those consumers who with the same annual incomes used to enroll.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2789602, ~/Articles/ArticleHandler.aspx, 9/1/2015 10:39:33 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Sean Williams

A Fool since 2010, and a graduate from UC San Diego with a B.A. in Economics, Sean specializes in the healthcare sector and in investment planning topics. You'll usually find him writing about Obamacare, marijuana, developing drugs, diagnostics, and medical devices, Social Security, taxes, or any number of other macroeconomic issues.

Today's Market

updated 1 hour ago Sponsored by:
DOW 16,058.35 -469.68 -2.84%
S&P 500 1,913.85 -58.33 -2.96%
NASD 4,636.11 -140.40 -2.94%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/1/2015 3:59 PM
EHTH $14.14 Down -0.80 -5.35%
eHealth, Inc. CAPS Rating: *