Clover Health Has Multiple Catalysts Converging to Move It Forward
InvestorPlace - Stock Market News, Stock Advice & Trading Tips CLOV stock owners should be proud to invest in a business that helps seniors get health care while also providing...
Here’s a rare opportunity for you. A “next-generation Medicare Advantage insurer,” Clover Health (NASDAQ:CLOV) operates in a high-potential market, providing health care access to seniors and other patient demographics. Yet, CLOV stock is trading at a surprisingly low price.
Currently, this stock has landed gently at a strong support level. So, it might be worth parking your capital in Clover Health shares just based on the technical considerations.
However, there’s also more to the story here. Sure, CLOV stock can be pigeonholed as a meme stock, but Clover Health deserves traders’ attention as a value-added business.
All in all, this company is providing a crucial service in an otherwise challenging health care system. With that, you can feel good about making an investment — and not only because of the profit potential.
A Closer Look at CLOV Stock
Earlier this year, a number of features made CLOV stock a good short-squeeze candidate. These included the low share price, the relatively low trading volume (prior to the squeeze) and the fact that it’s not a blue-chip stock.
The confluence of these factors seemed to attract Reddit traders. As a result, shares zoomed from $8 to as high as $28 in early June.
Unfortunately for folks who chased CLOV stock near $28, the price tumbled in the following months. But the good news is that there’s now an opportunity to get in this name at a prime buying level.
With the stock landing recently at $7 and change, investors can look back and observe how the market has tended to provide support at that price point. There’s evidence of this in March, April and May. Multiple times, sellers just couldn’t bring shares below the $7 level.
Therefore, this pick may be an opportunity to flex your contrarian-investor muscles before the next rally commences.
Expanding Care for Patients
It’s not 100% accurate to say that all of Clover Health’s customers are seniors seeking affordable health insurance. Yet, that appears to be the company’s primary target demographic.
Clover Health assists U.S. seniors and their doctors with its flagship software platform, Clover Assistant. With this platform, the company seeks to provide patients with highly affordable health care plans, while also “empowering physicians” with potentially lifesaving patient data.
No doubt, Clover Assistant has helped to boost the company’s top line. During the second quarter of 2021, the company took in $412 million in total revenues. That marks a whopping 140% year-over-year (YOY) increase.
But there’s also more good news. Just recently, Clover Health revealed that the Centers for Medicare and Medicaid Services (CMS) has “approved the company’s service area expansion to operate in 101 new counties.” The expanded coverage will commence on Jan. 1, 2022 and include parts of New Jersey, Georgia, Texas and elsewhere.
An Essential Response to Covid-19
In all, Clover’s total coverage area for its Medicare Advantage plans is expected to comprise 209 counties across nine different U.S. states. That broader regional coverage is great. However, there’s even more for CLOV stock stakeholders to celebrate.
Recently, Clover Health disclosed that it will provide in-home Covid-19 vaccinations. This could be a real lifesaver for homebound patients, some of which might not otherwise have convenient access to vaccine shots.
In order to implement this program, the company has partnered with health care logistics and services platform MedArrive. Together, the two companies will kick off the vaccination program in New Jersey to start.
Kumar Dharmarajan, the company’s Associate Chief Medical Officer, clarified the extraordinary benefits of this in-home vaccination program.
“This service allows our most vulnerable members to get essential care in the most timely and convenient way possible, which we believe will ultimately improve their quality of life, reduce hospital admissions and drive down healthcare costs.”
The Bottom Line on CLOV Stock
With CLOV stock currently trading between $7 and $8, consider it an opportunity.
Sure, the Reddit short-squeeze mob might propel the Clover Health share price back into the $20s. Just as importantly, however, the company is also providing essential services to many of the country’s seniors.
To me, that makes CLOV an investment that you can own with pride for the long term.
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On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.
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