CLOVER HEALTH INVESTMENTS, CORP. /DE (CLOV): what the price requires

The current priced-in claim for CLOVER HEALTH INVESTMENTS, CORP. /DE (CLOV) is temporarily suppressed because the live engine record is unavailable. The dated report remains a snapshot, not a current market read.

Generated: 2026-07-19 · Source: https://boothcheck.com/report/CLOV

Headline

FieldValue
TickerCLOV
CompanyCLOVER HEALTH INVESTMENTS, CORP. /DE
Current price$4.53/sh

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basisfinancials
Price-to-book7.10x

The implied return on book is non-physical at this price-to-book and is suppressed as misleading. The price sits beyond a 17.4% return on equity sustained for 40 years and is not resolvable as a sustainable-ROE point. The rarity read below is the honest signal.

How unusual the bet is: extreme

ReferenceValue
vs own history+3.89σ
cohort percentile (of 80 peers)91
sustained it ~10 years at this level24%
implied end-window share0%

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset7.50x4expensive
Earnings4.23x3expensive
Relative2.41x4expensive
Growth0.69x3justifies

Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.2%); the inversion above states its own rate.

Per-Model Detail (n=14)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$4.321.05xyesFCF base $0.1B, growth 25% (input: historical growth), terminal g 4.0%, WACC 9.2%, 7yr projection
DCF Exit MultipleGrowth$0.00—noNegative/zero FCF or EBITDA — equity value floored at $0
Relative ValuationRelative$1.872.42xyesP/E 37.4x (blended: static sector reference 17x + trailing (TTM) 91x), scenarios: 29.9x / 37.4x / 44.9x (bear / base = reference held flat / bull), EV/EBITDA 11x
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$0.647.07xyesBook value floor: BV/sh $0.64, ROE negative
Two-Stage Excess ReturnAsset$0.577.94xyesBook value with convergence: BV/sh $0.64, ROE converges to ke
Discounted Future Market CapGrowth$6.570.69xyesRev $2.2B, growth 30% (input: historical growth; tapered), Terminal P/S: 0.9x / 1.1x / 1.3x (bear / base = today's held flat / bull, cap 12x)
Peter Lynch Fair ValueRelative$0.607.54xyesEPS $0.05, growth 2% (input: historical EPS growth), PEG=0.00 (Undervalued)
Margin TrajectoryGrowth$20.230.22xyesMargin ramp: -3% → 12% over 7yr, rev growth 30% (input: historical growth; tapered)
Earnings Power ValueEarnings——no—
Residual IncomeAsset——no—
Graham NumberAsset$0.855.32xyes√(22.5 × EPS $0.05 × BVPS $0.64) — Graham's conservative floor
EV/EBITDA RelativeRelative——no—
FCF YieldEarnings$1.074.23xyesFCF $54.5M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings——no—
Ben Graham FormulaEarnings$1.612.81xyesEPS $0.05 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset$0.4111.04xyesBV $0.64 × (ROIC 6.0% / WACC 9.2%)
P/Sales SectorRelative$2.911.55xyesRevenue $2.21B × sector P/S 0.7x
PEG Fair ValueRelative$1.882.41xyesEPS $0.05 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings YieldEarnings$0.548.38xyesEPS $0.05 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Share count CAGR (dilution)3.0%

Deposit/float-funded balance sheet: debt is funding, not corporate leverage, and GAAP operating cash flow follows loan flows. Net-debt, interest-coverage, and cash-burn lenses do not apply. The solvency frame for a financial is regulatory capital and payout capacity (CET1, stress buffer, dividends plus buybacks against earnings).

Bullet Takeaways

Bull Case

Read Clover at the right stage and the picture changes. This is no longer a cash-burning insurtech experiment; it is an insurer that has crossed into profitability while still growing like an early-stage company. Average Medicare Advantage membership reached roughly 155,000 in the first quarter, up about 51% year over year, and revenue grew 62.1% to $749.2 million. For a health insurer, growth and underwriting discipline usually pull against each other, because rapid enrollment brings in members whose costs you have not yet learned. Clover grew fast and still posted GAAP net income of $27.3 million and consolidated gross profit of $159.5 million in the quarter. That combination is the bull's opening fact.

The engine underneath the growth is the clinical model. Clover's pitch is that its software steers physicians toward earlier intervention on chronic disease, which over time bends the medical cost curve for its members. The proof a skeptic should demand showed up where it matters most for a Medicare Advantage plan: the Star rating. CMS set the 2026 rating on Clover's PPO contract at 4.5 Stars, covering more than 97% of members, with the separate HMO contract also moving to 4.5 Stars. Stars are not a vanity metric in this business; they drive the bonus payments and rebates that fund richer benefits, which in turn drive enrollment. A plan that earns its Stars compounds.

The optionality sits in Counterpart Health, the move to sell the Clover Assistant platform to other healthcare organizations rather than only running it inside Clover's own plans. The company reported 450% year-over-year growth in platform customer users, and the structure is asset-light: it extends the clinical model into markets where Clover does not operate an insurance plan, without the capital and regulatory weight of writing the risk itself. Among its managed-care cohort, the disruptor framing is not unique to Clover. Alignment Healthcare describes the same dynamic in its own filing, that it "routinely take[s] market share from large established players", and that is precisely the lane both occupy. If Counterpart turns into a real software revenue stream layered on a now-profitable insurer, the bull case is that today's price is paying for a business that has stopped being a science project.

Bear Case

How management has funded its way to this point is the bear's first concern. The path to scale has run partly through the share count, which has grown rather than shrunk, diluting existing holders even as the operating story improved. An insurer is, at bottom, a pool of regulatory capital that earns a return; when the count of claims on that capital keeps rising, each share owns a thinner slice of the book. The capital-return capacity that defines a healthy financial, dividends and buybacks measured against earnings, is not yet part of this story. The company is reinvesting and issuing, not returning, and a buyer at today's price is underwriting more of the same.

The valuation is where the bear case has its sharpest edge. The price sits at roughly eight times book value, which is the top of the managed-care peer group by a wide margin. An insurer is worth the return it earns on its capital, and the price-to-book it can support is a direct function of that return. At eight times book, the price assumes a return on capital so far above anything Clover, or almost any insurer in history, has actually sustained that it cannot be expressed honestly as a single figure. The asset-value methods, which read an insurer off its book and its realistic return, land at a small fraction of the price. The earnings-power and peer-multiple methods also place the price well above what the demonstrated economics support. Only the growth-dependent methods reach today's level, and they get there by assuming the recent revenue trajectory persists and margins ramp from near breakeven into the low double digits over years. That is the entire bet.

The fragility is that the bet depends on a sequence holding together: continued membership growth, Stars staying high, medical costs staying contained, and Counterpart maturing into real revenue, all at once. Medicare Advantage is a politically and administratively exposed business, where CMS rate notices, risk-adjustment rules, and Star methodology changes can move economics in a single annual cycle. The company's own 2026 guidance frames the modesty of current profitability plainly: full-year GAAP net income of $0 to $20 million on revenue of $2.81 to $2.92 billion. A price at eight times book resting on a thin double-digit-million annual profit guide is the gap the bear points at. If growth decelerates or a Star or cost surprise lands, the static methods that already say richly valued become the floor the price falls toward.

Valuation

The cleanest way to value Clover is the way you value any insurer: not on an operating multiple but on the return it earns on its capital, read off price-to-book. On that lens the number that matters is stark. The price sits at roughly eight times book value, the very top of the managed-care peer group, and the return on capital that multiple implies runs so far above what the company has actually earned, and above what almost any insurer has sustained, that a single figure for it would mislead rather than inform. The price pays a multiple of net worth that no durable return record supports. That is the bet stated plainly.

The disagreement among the methods sharpens it. The asset-value approaches, which read the insurer off its $0.64 of book value per share and a realistic return, land at well under a dollar. The earnings-power methods, working off thin current earnings, land in the low single digits. The peer-multiple methods, even crediting the growth, reach only a fraction of the price. Only the growth-dependent methods, the discounted future-revenue and margin-trajectory frames, reach today's level, and they do so by assuming roughly 30% revenue growth persists and the operating margin climbs from near breakeven into the low double digits over a seven-year horizon. When every static frame says richly valued and only the most growth-optimistic frame reaches the price, the price is paying for durable compounding that the conservative methods structurally cannot price. The recent results give that bet real support: Q1 2026 turned GAAP-profitable with $27.3 million of net income and 62.1% revenue growth, and the 4.5-Star PPO rating underpins the 2027 bonus economics.

Because Clover is funded as an insurer, the usual solvency frame, net debt, interest coverage, cash burn, does not apply; what matters is regulatory capital and payout capacity. There the read is mixed: the company has reached profitability but guides to only $0 to $20 million of GAAP net income for the full year, and it is funding growth partly through share issuance rather than returning capital. The downside is therefore bounded less by a fortress balance sheet than by whether the growth and Star economics that justify the multiple actually hold. Among its cohort, Alignment Healthcare frames the same competitive opportunity Clover is chasing, and the comparison is the right one to make; the consolidated multiple here should be read against insurtech-style growth peers, not against the mature managed-care names whose returns are steady and whose multiples are a fraction of this one.

Catalysts

The defining recent event is the Star rating. CMS set Clover's 2026 PPO contract at 4.5 Stars, covering more than 97% of members, and moved the separate HMO contract to 4.5 Stars as well. Star ratings drive the bonus payments and rebates that fund Medicare Advantage benefits, so a 4.5-Star plan strengthens Clover's competitive and economic position heading into the 2027 plan year. The next watch item is whether that rating translates into the bonus-funded benefit richness that drives enrollment in the coming annual enrollment cycle.

The operating trajectory is the second catalyst. Q1 2026 delivered GAAP net income of $27.3 million on $749.2 million of revenue, up 62.1% year over year, with adjusted EBITDA of $40.3 million and average membership growth around 51%. Management reaffirmed full-year 2026 guidance of $2.81 to $2.92 billion in revenue and $0 to $20 million of GAAP net income. The gap between the strong first quarter and the modest full-year profit guide is itself the thing to watch: it implies the back half carries seasonality or investment that the first quarter did not.

Counterpart Health is the structural catalyst. The platform reported 450% year-over-year growth in customer users, marking the early scaling of an asset-light software business layered on the insurance operation. Analyst sentiment remains cautious despite the operating improvement: recent price targets cluster between roughly $2.60 and $4.20, with a Canaccord Genuity target of $4.20 set in June 2026, several of which sit below the current price. The reconciliation is that the street credits the turnaround but not the eight-times-book multiple, which is the same tension the valuation work surfaces.

Peer Cohorts (Per Segment, With Filing Citations)

Insurance (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Q1 2026 earnings release · company announcement, June 2026 · Q1 2026 investor presentation · company FY2026 guidance · analyst notes, 2026

View the full interactive CLOV report on boothcheck