Clover Health Investments, Corp. (NASDAQ:CLOV) shareholders are no doubt pleased to see that the share price has bounced 36% in the last month, although it is still struggling to make up recently lost ground. But the gains over the last month weren't enough to make shareholders whole, as the share price is still down 6.2% in the last twelve months.
Although its price has surged higher, considering around half the companies operating in the United States' Healthcare industry have price-to-sales ratios (or "P/S") above 1.2x, you may still consider Clover Health Investments as an solid investment opportunity with its 0.2x P/S ratio. However, the P/S might be low for a reason and it requires further investigation to determine if it's justified.
How Has Clover Health Investments Performed Recently?
While the industry has experienced revenue growth lately, Clover Health Investments' revenue has gone into reverse gear, which is not great. It seems that many are expecting the poor revenue performance to persist, which has repressed the P/S ratio. If this is the case, then existing shareholders will probably struggle to get excited about the future direction of the share price.
Keen to find out how analysts think Clover Health Investments' future stacks up against the industry? In that case, our free report is a great place to start.
How Is Clover Health Investments' Revenue Growth Trending?
There's an inherent assumption that a company should underperform the industry for P/S ratios like Clover Health Investments' to be considered reasonable.
Taking a look back first, the company's revenue growth last year wasn't something to get excited about as it posted a disappointing decline of 36%. Still, the latest three year period has seen an excellent 186% overall rise in revenue, in spite of its unsatisfying short-term performance. Although it's been a bumpy ride, it's still fair to say the revenue growth recently has been more than adequate for the company.
Looking ahead now, revenue is anticipated to slump, contracting by 11% each year during the coming three years according to the three analysts following the company. Meanwhile, the broader industry is forecast to expand by 7.4% per year, which paints a poor picture.
With this information, we are not surprised that Clover Health Investments is trading at a P/S lower than the industry. Nonetheless, there's no guarantee the P/S has reached a floor yet with revenue going in reverse. Even just maintaining these prices could be difficult to achieve as the weak outlook is weighing down the shares.
The Final Word
The latest share price surge wasn't enough to lift Clover Health Investments' P/S close to the industry median. While the price-to-sales ratio shouldn't be the defining factor in whether you buy a stock or not, it's quite a capable barometer of revenue expectations.
It's clear to see that Clover Health Investments maintains its low P/S on the weakness of its forecast for sliding revenue, as expected. At this stage investors feel the potential for an improvement in revenue isn't great enough to justify a higher P/S ratio. Unless these conditions improve, they will continue to form a barrier for the share price around these levels.
Before you take the next step, you should know about the 2 warning signs for Clover Health Investments that we have uncovered.
Of course, profitable companies with a history of great earnings growth are generally safer bets. So you may wish to see this free collection of other companies that have reasonable P/E ratios and have grown earnings strongly.
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
価格が上昇しているにもかかわらず、米国のヘルスケア業界で運営している企業の約半数が価格-売上高比率(または「P / S」)が1.2倍を超えていることを考えると、Clover Health Investmentsは0.2倍のP / S比率でソリッドな投資機会と考えることができるかもしれませんが、これは低いP/S比率が理由である可能性があり、正当化されるかどうかを判断するためにさらなる調査が必要です。
クローバーヘルス投資法人は最近どのようなパフォーマンスを発揮しているのでしょうか?
業界は最近収益成長を経験していますが、Clover Health Investmentsの収益は逆行しており、素晴らしいとは言えません。多くの人々が収益の低下を持続すると予想しており、それがP/S比率を抑圧しているようです。その場合、既存の株主は株価の将来の方向に興奮することができない可能性があります。
アナリストがClover Health Investmentsの将来の見通しについてどのように考えているか知りたいですか?その場合、無料レポートがお勧めです。
Clover Health Investmentsの収益成長はどのように推移していますか?
Clover Health InvestmentsのP/S比率のような場合、企業が業界に対して劣っているという前提があります。理にかなっているかどうかを考えるためです。
この情報から、Clover Health Investmentsが業界に比べて低いP/Sで取引されていることに驚くことはありません。それでも、収益が逆行しているため、P/Sがまだ底に達していないことは保証されていません。これらの価格を維持することさえ難しいかもしれません。弱い見通しが株価に重荷をかけています。
最終的な言葉
最新の株価の上昇は、Clover Health InvestmentsのP/Sを業界の中央値に近づけるために十分ではありませんでした。価格対売上高比率が株式を買うかどうかの定義的要因であるべきではありませんが、収益期待のかなり優れたバロメーターです。
予想通り、Clover Health Investmentsは売上高が下降するという弱みに基づいて、低いP/Sを維持しています。この時点では、株価を支える収益向上の可能性は十分に高くないと投資家は感じているため、高いP/S比率を正当化することはできません。これらの条件が改善しない限り、これらのレベルを中心に株価を支える壁を形成し続けます。
次のステップに進む前に、私たちが発見したClover Health Investmentsの2つの警告サインについて知っておく必要があります。