Yahoo Finance eHealth (EHTH) Q4 Earnings Top, Approved Members Fall Y/Y
eHealth EHTH delivered adjusted net earnings of $1.14 per share, which surpassed the Zacks Consensus Estimate by 147.8%. The bottom line more than doubled year over year.
The company’s results highlighted lower operating costs and expenses. However, revenues declined and so did approved members.
eHealth, Inc. Price, Consensus and EPS Surprise
eHealth, Inc. price-consensus-eps-surprise-chart | eHealth, Inc. Quote
Operational Update
Total revenues declined 18.7% year over year to $196.3 million in the quarter on lower commissions. However, the top line outpaced the Zacks Consensus Estimate by 12.2%.
Revenues from the Medicare segment declined 21.7% year over year to $180.4 million. Meanwhile, revenues from the Individual, Family and Small Business segment amounted to $15.9 million, reflecting a rise of 23% year over year. The Medicare segment revenues suffered from a decrease in commission revenues, partially offset by improved conversion rates and an increase in the constrained lifetime value of commissions per approved Medicare Advantage member.
Revenues of the Individual, Family and Small Business segment reflected an increase in commission revenues, partially offset by a 26% decline in ancillary product-approved members.
Total operating costs and expenses decreased 40.3% year over year to $165.6 million due to lower marketing and advertising, customer care and enrolment, and impairment, restructuring and other charges.
Adjusted EBITDA improved 76% year over year to $49.5 million in the quarter under review, while margin more than doubled to 25%.
Medicare segment profit grew 56% year over year to $53.1 million in the quarter on lower Medicare operating expenses and improved unit economics. Profit at Individual, Family and Small Business segment increased 26.6% from the prior-year quarter to $9.1 million.
Medicare-approved members of 161,469 declined 33% year over year in the quarter, courtesy of lower Medicare Advantage-approved members, Medicare Supplement-approved members and Medicare Part D Prescription Drug Plan-approved members.
Also, the approved members for individual and family plan products of 14,010 declined 2% year over year.
Financial Update
The company exited 2022 with cash and cash equivalents of $144.4 million, which increased 76.3% from the 2021-end level.
As of Dec 31, 2022, shareholders’ equity declined 13.2% from the level at 2020 end to $651 million.
During the quarter, net cash used in operating activities was $26.9 million versus $162.6 million used in 2021.
2023 Guidance
Total revenues are expected to be in the range of $420 million to $440 million. GAAP net loss is expected to be in the range of $55 million to $35 million. Adjusted EBITDA is expected to be in the range of negative $15 million to positive $5 million. Operating cash outflow is expected to be in the range of $15 million to $30 million.
Zacks Rank
eHealth currently 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
Willis Towers Watson Public Limited Company WTW delivered fourth-quarter 2022 adjusted earnings of $6.33 per share, which beat the Zacks Consensus Estimate by 0.6%. The bottom line improved 12% year over year. Willis Towers Watson posted adjusted consolidated revenues of $2.7 billion, up 1% year over year on a reported basis. Revenues increased 5% on an organic basis and 4% on a constant currency basis. The top line beat the Zacks Consensus Estimate by 1.4%.
Adjusted operating income was $882 million, up 1.3% year over year. Margin expanded 20 basis points (bps) to 32.4%. Adjusted earnings before Interest, taxes, depreciation, and amortization (EBITDA) was $1 billion, down 1.4% year over year. Adjusted EBITDA margin was 37.1%, contracted 80 bps. For 2023, Willis Towers expects to deliver mid-single-digit organic revenue growth with expansion in adjusted operating margin.
Aon plc AON reported fourth-quarter 2022 operating earnings of $3.89 per share, which beat the Zacks Consensus Estimate of $3.67 and our estimate of $3.58. The bottom line also climbed 5% year over year. Total revenues of $3,130 million were up 2% from a year ago and beat the consensus mark of $3,120 million and our estimate of $3,079.9 million. The top line comprised organic revenue growth of 5%, a 1% favorable impact from fiduciary investment income, partially offset by a 4% unfavorable impact from foreign currency translation.
Adjusted operating income jumped 3% year over year to $1,038 million and beat our estimate of $1,030.4 million. Adjusted operating margin expanded 40 bps to 33.2%. Aon expects to achieve double-digit free cash flow growth in 2023 and the long run. Organic revenues are expected to witness mid-single-digit or more growth for 2023.
Marsh & McLennan Companies, Inc. MMC reported fourth-quarter 2022 adjusted earnings per share of $1.47, which beat the Zacks Consensus Estimate of $1.40 by 5% and our estimate of $1.33. The bottom line improved 8% year over year. Consolidated revenues of MMC fell 2% year over year but grew 7% on an underlying basis to $5,022 million in the quarter under review. The top line lagged the consensus mark by 4% and our estimate of $5,063.5 million.
Consolidated adjusted operating income improved 13% year over year to $1,024 million. Adjusted operating margin of 22% improved 160 basis points year over year in the quarter under review.
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