eHealth's Guidance Update: Here's What a Strong AEP Signals

eHealth, Inc. EHTH recently announced that it is raising its financial outlook for fiscal year 2025 after a stable Annual Enrollment Period (AEP) performance, especially in its Medicare business. Management now forecasts total revenue of roughly $540-$560 million, narrowed from prior guidance, and GAAP net income between $30-$45 million, which is noticeably higher than its earlier outlook.

The company also lifted its adjusted EBITDA range to approximately $80-$95 million, from the previous range of $60-$80 million. While operating cash flow is expected to be between roughly negative $25 million and zero, the overall picture reflects improved profitability and momentum.

The Zacks Consensus Estimate for 2025 bottom line is currently pegged at 29 cents per share, indicating 119% year-over-year improvement. The bottom line is expected to further jump to $1.88 per share in 2026.

The reasons behind this updated outlook are stable enrollment results during AEP, a shift toward higher-quality direct branded channels, and the use of AI tools that boosted marketing efficiency and sales conversion. eHealth also noted that the lifetime value in the fourth quarter is expected to grow year-over-year because of higher commission rates and better persistency trends.

For eHealth, this means the company is gaining better profitability traction and operational discipline, strengthening confidence in execution after prior years of financial pressure. Investors will see this as a positive signal on growth and cost management trends.

This update shows eHealth is navigating a competitive Medicare market more effectively, using tech and channel strategy to drive results, and that its most important enrollment period can materially move the company’s full-year prospects.

How Are Other Health Insurers Faring?

Centene Corporation CNC has been among the most volatile, reflecting its heavy exposure to ACA exchanges and Medicaid. However, tighter pricing discipline, better risk adjustment, a steadier regulatory backdrop and sustained enrollment in government programs should help CNC’s profitability recover over time. UnitedHealth Group Incorporated UNH is also seeing margin pressure from elevated medical utilization, but its massive scale, diversified earnings and analytics-led cost controls provide resilience. With disciplined capital allocation and refreshed leadership, UNH remains well-positioned heading into 2026 as a durable, high-quality compounder. Longer-term visibility and execution discipline should continue to differentiate outcomes.

EHTH’s Price Performance & Valuation

Shares of eHealth have gained 7.3% over the past three months, outperforming the broader industry and the S&P 500 Index.

EHTH YTD Price Performance

From a valuation standpoint, eHealth trades at a forward price-to-sales ratio of 0.25X, down from the industry average of 3.22X. Yet it carries a Value Score of C.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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