Healthcare technology company Clover Health Investments’ (CLOV) stock price hit new highs earlier last month, propelled by the meme-stock frenzy. However, given the stock’s ebbing momentum, is it a safe pick now? Let’s find out.Data-driven health insurance company Clover Health Investments, Corp. (CLOV), which is based in Franklin, Tenn., offers preferred provider organization (PPO) and health maintenance organization (HMO) health plans for Medicare-eligible consumers. Unfortunately, although the meme-stock fervor set CLOV on fire in June, the stock has lost its momentum lately. Its shares are down 37.9% over the past month and 43.5% over the past six months.
While an increase in membership and CLOV’s progress in providing high-quality care to its customers helped it generate decent revenue growth in its last reported quarter, its losses have nearly doubled. Management expects the company’s non-GAAP normalized adjusted EBITDA to be in the range of negative $240 - $190 million for the full year 2021. Furthermore, the company has yet to establish itself as a profitable player in the healthcare industry.
The stock is trading 71.2% below its all-time $28.85 price high, which it hit on June 9, which indicates bearish sentiment. Also, it is trading lower than its $10.41 and $10.57 respective 50-day and 200-day moving averages, which reflects a downtrend.