eHealth Shares Up 30% Since Q4 Earnings Announcement

eHealth (NASDAQ:EHTH) share gained more than 30% since the company’s reported Q4 results last week, with revenue of $196.3 million beating the Street estimate of $179.01 million. EPS came in at $0.41, compared to the Street estimate of $0.56.

According to the analysts at RBC Capital, the company posted a strong finish to 2022, having demonstrated solid execution on quality enhancement initiatives launched in the second half of 2021, which principally involved the overhaul of sales and marketing practices, as well as attention to improvement in lead quality.

The analysts expect momentum to continue given member retention initiatives and diversification efforts. The analysts maintained their Sector Perform rating, but cut their price target to $13 from $16.

eHealth (NASDAQ:EHTH) shares plunged more than 16% on Tuesday (recovered today - up 9%) despite the company reporting better-than-expected Q4 revenues of $196.3 million (vs. Street’s $179.01 million) and positive outlook.

Q4 adjusted diluted EPS came in at $1.14 came, beating the Street estimate of $0.83 driven by significant margin improvement in Medicare business with ongoing operating cost savings.

Despite the solid earnings beat and positive 2023 guidance, shares plummeted as some commentary around imminent details on a potential capital raise may have struck investors’ attention.