Investing in the stock market can be a complex financial decision, especially with the wide variety of options available. While no industry offers guaranteed returns to investors, companies in the health insurance field can offer many potential advantages to investors. Because health care is a required service, companies in this industry tend to be more resistant to recessions and other economic difficulties.
In particular, Health Insurance Innovations (HIIQ), a third-party developer and administrator of short-term medical, health benefit and supplemental insurance plans, offers investors several vital reasons for consideration: strong growth projections, marketable services, and rapid revenue gains from 2017 until today. Stock traders looking to invest in the health insurance sector can find many appealing and optimistic indicators pointing toward the growth potential for stock of the cloud-based health insurance distributor.
Unique Services Provided
Health Insurance Innovations is a developer of short-term medical insurance plans. The company doesn’t sell plans, but rather, offers cloud-based technology that makes selling simpler for those who do sell insurance policies. These plans typically cover only a few months rather than those designed to cover individuals and families for years. The short-term policies can offer many benefits for consumers: they are extremely affordable, they can address gaps in coverage, and enrollment is available throughout the year.
Because short-term health insurance is attractive to many consumers, a successful innovator such as HIIQ can be a smart investment option for stock traders. Health insurance is an industry that remains relevant in any economic climate, and short-term policies fulfill a portion of the market with a strong customer base. HIIQ is unique with its proprietary business model that provides agents and brokers with an easy-to-use web-based platform for quoting, billing, and underwriting. The company’s partnerships with leading insurance carriers allow it to offer a wide selection of insurance plans to help these agents and brokers meet the needs of a large and diverse customer base.
Excellent Stock Market Performance in 2017
Health Insurance Innovations (NASDAQ: HIIQ) stock performed exceptionally well in 2017. In the first half of the year, stock prices increased 27.7 percent. Perhaps even more impressive is the fact that HIIQ stock jumped in value by 45.5 percent in the second quarter alone. The company earned a place on the list of Tampa Bay’s “hottest stock market performers for the first half of 2017.”
The company saw a record-breaking 35.8% increase in total revenue compared to 2016, spurned by a record number of total collections from members (nearly $400 million in 2017). Share prices are consistently outperforming the 50-period simple moving averages, which show the recent wins the company is experiencing figure to be part of sustainable long-term success. Perhaps the most eye-opening increase came in the net income category. Fourth quarter net income was $5 million, up 257% year-over-year.
The company also received a nomination in the semifinal round of the Small Business of the Year Award. This prestigious nomination, presented by the Greater Tampa Chamber of Commerce, is just another indication of the company’s stellar performance. Despite the difficult state of the economy in general last year, HIIQ performed very well, including logging record growth of both the top and bottom line in Q3 of 2017. Because of the company’s built-in scaling technology, it’s poised to easily increase its customer base without requiring a large financial or technological investment.
Strong Q1 Performance
It seems that Health Insurance Innovations is poised to continue record growth in the current year. The company recently released its Q1 numbers, and the data is encouraging:
- Revenue of $67.8 billion, a 21.3% increase over 2017 Q1 results
- 383,200 policies in force at the close of Q1, an increase of 11.1% compared to Q1 last year
- Adjusted net income per share of $0.52, a 44.4% increase over the $0.36 metric of Q1 in 2017
- Total premium equivalents from members of $105 million, a significant improvement over $90.9 million in the first quarter of 2017
- Adjusted earnings before interest, taxes, depreciation, and amortization of $11.9 million, a 22.7% increase over last year’s numbers
Health Insurance Innovations is anticipating “between $290 million and $300 million” in annual revenue this year, an increase of about 15-20% from 2017. With the short-term healthcare market representing a potential $14 billion market opportunity, HIIQ is primed to capitalize and doesn’t have the same growing pains as a brick-and-mortar business.
Exceptional Market Opportunities in the Competitive Post-Obamacare Industry
Trends in the healthcare industry are favorable for a company like HIIQ. Much like we’re seeing in the Life Insurance space, where higher employment and a stronger economy have lifted the potential companies in the space. Health Insurance Innovations offers simplified and affordable individual healthcare options with a viable business model. Even relative to the industry average, HIIQ is especially well-positioned.
The numerical stock data presents an encouraging picture of the growth possibilities. The company’s product offerings and business model showcase a deep understanding of the health insurance market. HIIQ’s innovative online platform provides accurate quotes in seconds and allows customers to purchase plans right on the website. Customers can receive proof of coverage and ID cards almost immediately, which is much faster than with traditional insurance broker models.
While short-term health insurance is less popular than traditional employer-provided long-term plans, this product serves a large sector of the market: uninsured and underinsured people. Those who find typical Obamacare plans unaffordable can purchase short-term policies at a much lower cost and can continue to receive coverage in between jobs while paying lower premiums than those of other gap-coverage policies (e.g. COBRA).
Invest in Health Insurance Innovations with Confidence
When you’re looking for high-ceiling stock investing possibilities, choose a company with a strong financial standing and outstanding projected stock trajectories. Learn more about Health Insurance Innovations and its recent successes to see why it can be a smart investment option for you.