EHTH had a large decline after last Earnings Report. They are growing their Customer's at a AMAZING pace, Company is starting to show profits, but why then the drop?
High Churn (for those that don't know what Churn is, Imagine 100 People sign up for your service, but next month only 45 of those new customers stayed. This is Churn, its Great that your growing 100 customers a month but if your retaining less than half of those new customers, that's not good. Because it maybe be sustainable now as you continue to grow 100 customers a month, loosing 55 is not the end of the world because your still Plus 45 Customers. But what happens when growth slows and Churn continues? That's right now we have a declining business! Say we are only bringing on 15 New Customers a month now, but have the same Churn... loosing 55 customers a month, at this rate, we will be out of business quickly. So in recurring revenue models Churn Rate is very important) plain and simple. Since then the CEO has been on Mad Money with Cramer, said they've hired a 3rd party that specializes in addressing Churn, and is confident that the issue has been addressed. Meanwhile Cramer has bashed EHTH on several occasions since, beating the stock down, to a point it's been trading at the lowest P/E in a very long time. Furthermore, 3 Different insiders, including the CEO, have bought over 52,000 shares at an average share price of about $75 a share, some buying literally the day after Earnings Drop, with NO INSIDERS selling any shares in the past 3 months. Usually a good sign. 5 year growth rate of 491% and expected growth for next year at 38.2%. This is an easy pick here. Market cap equivalent of 2023 expected revenue, I suspect that by next earnings report you will see this stock trading back at normal levels, and with a good earnings Report take off to new High's. Options calls here are very attractive, although the 10/16 Options are prior to Earnings, its an inexpensive Easy options call to double your money. Beyond the financials we appear to have a couple of bullish setups including Elliot Wave and some consolidation taking place before we continue up. We have the 200 Day moving average as strong support with plenty of upside ahead.
Will update on Trade Day 3 to 100k later along with another chart coming out. Stayed tuned.
Day 3 taking $1,800 to $100K in 30 Days.
I am not a financial advisor, this is not financial advise. This is for entertainment purposes only.
Please be sure to do your own HW and DD before purchasing any stocks.
High Churn (for those that don't know what Churn is, Imagine 100 People sign up for your service, but next month only 45 of those new customers stayed. This is Churn, its Great that your growing 100 customers a month but if your retaining less than half of those new customers, that's not good. Because it maybe be sustainable now as you continue to grow 100 customers a month, loosing 55 is not the end of the world because your still Plus 45 Customers. But what happens when growth slows and Churn continues? That's right now we have a declining business! Say we are only bringing on 15 New Customers a month now, but have the same Churn... loosing 55 customers a month, at this rate, we will be out of business quickly. So in recurring revenue models Churn Rate is very important) plain and simple. Since then the CEO has been on Mad Money with Cramer, said they've hired a 3rd party that specializes in addressing Churn, and is confident that the issue has been addressed. Meanwhile Cramer has bashed EHTH on several occasions since, beating the stock down, to a point it's been trading at the lowest P/E in a very long time. Furthermore, 3 Different insiders, including the CEO, have bought over 52,000 shares at an average share price of about $75 a share, some buying literally the day after Earnings Drop, with NO INSIDERS selling any shares in the past 3 months. Usually a good sign. 5 year growth rate of 491% and expected growth for next year at 38.2%. This is an easy pick here. Market cap equivalent of 2023 expected revenue, I suspect that by next earnings report you will see this stock trading back at normal levels, and with a good earnings Report take off to new High's. Options calls here are very attractive, although the 10/16 Options are prior to Earnings, its an inexpensive Easy options call to double your money. Beyond the financials we appear to have a couple of bullish setups including Elliot Wave and some consolidation taking place before we continue up. We have the 200 Day moving average as strong support with plenty of upside ahead.
Will update on Trade Day 3 to 100k later along with another chart coming out. Stayed tuned.
Day 3 taking $1,800 to $100K in 30 Days.
I am not a financial advisor, this is not financial advise. This is for entertainment purposes only.
Please be sure to do your own HW and DD before purchasing any stocks.