Clover Health Investments, Corp.

Hello, welcome to our stock trades. Welcome to the most anticipated earnings season that we have here on our channel. Very excited to be here with you guys. Right on time. We're going to go ahead and make sure we're all good. Let me know if you guys can hear me. Very excited to have you. And without further ado, let's go ahead and go. All right, so... Make sure if you guys can help, please post this on the StockTwits, the Reddit page. I kind of messed up with the 2022 versus 2023 nomenclature of the title, but I went ahead and fixed that. I just got to fix the picture here, but we're going to go ahead and focus on what matters right now, okay? So the biggest thing that I want to focus on here, okay, biggest thing is You can go ahead and read on the bottom about what's happening. I want us to basically look at a video I posted two months ago, specifically, I don't know, December 30th, 2022. I went ahead and net income story, Clover Health, and I wanted to do a net income analysis. Okay. so this is 2021 give q you know this is uh q4 q3 q2 and q1 of 2021 and then we have q1 q2 q3 of 2022 but we don't have q4 and today is the earnings for q4 of 2022 so we're going to go ahead and we're going to listen to the earnings now for some reason they only have what clover stated they don't have what the analysts were asking So hopefully that gets fixed. You guys can enlighten me if you joined live. Again, I was busy in the clinic today. Okay. So overall, if you look at the 2021 net loss of Clover, they had $587 million. And then for 2022, when I made this video, we didn't know the losses. Well, because we didn't have Q4. Now we do. But if you went ahead and I said, if we analyze from Q1 to Q3 of 2021... we had $400 million loss approximately last year from Q1 to Q3. From Q1 to Q3 of this 2022 cycle, we had $254 million loss approximately, which basically shows you that Clover is headed in the right direction. Now, a lot of folks went ahead and said, well, Al, let's go ahead and let's wait for Q4 of 2022 because maybe it may come higher than normal. Well, ladies and gentlemen, today's the day. If we go ahead and go down to this beautiful box here and we go and look at the net loss here, If we go all the way to the right and highlight the net loss for this section, and we go all the way up to the up, we can see 2021's full year standing for FY is $587 million, which is equivalent to what basically we calculated here, okay? But here's the greatest thing. If you go ahead and look at the full year loss of 2022, you can see it was $338 million. And if you go ahead and graph that, you can see that Clover is decreasing their net income loss and they're slowly becoming profitable. This is exactly what I would like to see in a company that is a growth stock, but now is leveraging down to becoming a... profitable stock. Okay. So overall based off of these, I mean, honestly, I skipped everything. I didn't even give a crap about the net income. All I cared about is the net loss. Now let me go ahead and give you a, uh, good, uh, For all the people that are working in the industry, working in – or you're in a very high level of management, if you look at your top line revenue and you go down to your bottom line, which is technically supposed to be your net income, not net loss. They're going to replace this to net income soon. You want around a 20%. That means all the revenue that gets trickled down and when you have in the net income statement with the revenue subtracted from the cost of goods sold after the operational expenses have been subtracted, you basically get at net income and you want that to be 20% of the net, the whole revenue, okay? Okay. So to do that, what you can do is you can take this number, 587 divided by the full year revenue of 2021. And by doing that, remember it's a negative number because this is in parentheses. It's accounting principles. So if we put negative 587.8 and you divide that by 1472, you get 0.399, negative 39%. Again, we want 20%, okay? Now, if we go ahead and change this to this year's net income loss, 338.8, you're at negative 23%. which shows me that they're slowly trickling up. Okay. Again, an ideal company is anything over 20%. Obviously the gray areas between 10 to 20, anything under 10% is, is a company that, you know, it's a, uh, that it's in an area that's very competitive. Now we can go ahead. I've never shown you this analysis. Again, there's a lot of things you can look at, uh, but we'll go ahead and make a video about it and we can teach for it. Okay. So So overall, Q4 2022, the MCR was 92.4%, and the full year of 2022 MCR for the whole year is 91.8%. Again, I want to see near the 85% range, okay? Now, 2023 guidance insurance MCR range is anywhere between 89% to 91%, and the non-insurance MCR range is 98% to 100%. Again, strong liquidity expected to meet 2023 operating requirements, indicating to me with that sentence that they are not going to be doing a share dilution this year. Okay, we're going to go ahead and listen to the earnings report now. And then we can go ahead and make another video to go into the specific details. Now, first they went ahead and published a couple of slides. I just want to go over them really quickly to give you some opinions here. And you know, cause sadly no one's covering Clover and it's a shame. So we'll go ahead and give my, uh, opinion on the matter. So, uh, We're going to go ahead and talk about this. I want to just talk about things that we normally don't mention here. So MCR, as you can see, it's dropping down. The guidance now is anywhere between 89% to 91%. As you can see, potentially the Clover assistant is doing his job, compounded by the fact that the CFO is doing a lot of cuts. to, you know, be in line with profitable, essentially being profitable. Okay. So let's go ahead and keep going. All right. So let's see here. Okay, I'm gonna keep going here. Okay, so here it is, the 2023 outlook. If you go ahead and do that, you can see the revenue for 2023 is gonna be anywhere between 1.9 billion to 2 billion. Again, in our calculation, we've essentially taken off a billion dollars And we've already done this calculation because of what they're trying to accomplish. They're trying to essentially decrease their non-insurance MCR to bring that down to make it profitable and obviously improve on the insurance MCR. All right, let's go ahead. And again, goal, shareholder value, obviously, because if you look at the, if you go down here, and look at the cash they have, cash and cash equivalents on the selected balance sheet data that they provide. We're going to go over the whole balance sheet, not in this video, but understand that don't ever look at a company's selected data as some of it is going to be non-GAAP versus GAAP. We like to go ahead and look at the data directly from the SEC, right? But again, it's I don't know if they filed it already. Usually takes time for a brain machine to get it. Now, if you look at the cash, they went from $791 to $555 million. The one that I want to talk to you about, since we're talking about shareholder value, you can see that total stockholders' equity has drastically decreased. You know, duh, as they're losing cash as they're burning cash right now. Right. Another thing that I want to go ahead and quickly mention here is in terms of lives under management, we are obviously still in a positive increase. What we want to know, though, is how are they? And I told you 2023 is going to be the year where we're going to know exactly how these people stack up. Okay? We're going to know 2023 is going to be the year. Q1 of 2024 is going to tell me all I need to know about Clover. Q1 of 2024, a year from now, in a couple of months, I'm going to get all the information I need to know about Clover so I can accurately know what portion of that intrinsic value, that target sign we're creating, will come into fruition. Okay? So overall, the prioritizing profitability, that's the top focus. Again, if you looked at their paperwork in 2020, before they became a SPAC, they were talking about profitability. The market gave them slack. And now the market has punished them to a point where if they continue at the rate of what they're doing, they're going to get delisted. Hence why now we're seeing profitability here, profitability here. Profit, just a bunch of just profit. This is the message now. So overall, they want to improve margins. So essentially decreasing cost of goods, aka gross margins will go up. We're going to go ahead and it looks like hopefully they talk about their path to profitability. That'll be a little nice to see. We'll talk about this early treatment of diabetes. It's actually really important. When people get diabetes, they have this thing called non-enzymatic glycosylation. And what that basically is, is in your kidneys, you have two arteries. You have arteries going in and arteries going out. The afferent arteriole and the efferent arteriole. The artery that's actually going out when people get diabetes is Over years, that type of artery gets built up of this non-enzymatic glycosylation, which basically increases the rate of kidney failure, right? And they go ahead and talk about this chronic kidney disease in the next slide. You get also other problems, peripheral neuropathy and also eye problems. Anytime you have micro vessels getting smaller, you essentially go ahead and diabetes, unfortunately, is one of those diseases that affects every little organ, okay? It's a very nasty bugger. And if they can catch it early and do treatments, imagine if they can catch it earlier in the pre-diabetic version, okay? Now, again, personally, I want to know the opinions of all the doctors that are watching. Please comment down below. And for the doctors that are in our private stock terminal, please go ahead and comment down below and in our stock terminal because Clover Assistant helps track glomerular filtration rate. Now, again, for people that don't understand what GFR is, Very quickly, I can explain it to you so you don't have to watch a 30-minute, two-hour video determining what the hell that is. So the GFR is estimated... It's a complex equation. You can go ahead and estimate. Every ethnicity has their own estimation. There's higher rates of kidney disease in different parts and different portions of the population. And different races have a different form of an equation that gets factored in. And based off of this calculation, you estimate the degree of how well your kidneys are perfusing. Now, when you go ahead and stage someone for kidney disease, there are levels. And the levels are essentially as follows. The GFR range is over 90. This is honestly a terrible staging system. I like this one. So anything above 90 is stage 1. 60 to 89, stage 2, et cetera, et cetera. You want to go ahead and most nephrologists prepare for hemodialysis here. And then after here, that's when they go into the hemodialysis. And please correct me if I'm wrong. I'm a medical student. I'm still learning. But that's pretty much what my understanding is. So overall, and this is not a lecture about nephrology. This is just trying to explain to you Personally, for me, Clover Assistant helps track GFR. Well, that is not impressive to me because I use Cerner, and Cerner helps track GFR. Epic, I just use Epic. And Epic, essentially, which uses the same platform that Clover Assistant was, you know, spawned on, they track GFR. So the tracking of GFR... It's not like, oh my God, this is some revolutionary thing. I think, you know, I would love for the company to, you know, Clover to show me like what's special with their tracking system of GFR that's different than the GFR of, you know, tracking the other one, right? Is it, you know, a way to... Are they collaborating an AI type approach that basically tells you that, Hey, this is about to go down. We should do this. I don't know, but they need to communicate it. But when a member's GFR declines to a certain range, Clover assistant prompts the PCP to consider CKD stage three, maybe, maybe. Cause again, you remember stage three is anywhere between 45 to 59. Okay. maybe the Clover assistant may see a decline from like 70 to like 60 or something. And then perhaps then it might Clover may say, Hey, go ahead and consider chronic kidney disease. But guys, it's very simple. The GFR is already calculated. And if it's, If it's under 59, ladies and gentlemen, it's already stage three. It's not rocket science, right? So I don't know at what levels do they prompt the physician that, hey, this is stage three. But based off of this in terms of kidney functionality, and they have a star here as it's measured via GFR, right? you can see that the Clover Assistant increases and helps the kidney function better because of its ability to track. So obviously they have data that suggests this. Now, personally, as a scientist, I would like to know the standard deviation error bars, if I may explain to you what I'm talking about. standard, deviation, error bars. you can know what I'm talking about. You see these bars here. Oh, here, here, here's a good one. You see these bars here. These bars tell me if this is this, you know, if this is statistically significant, are these changes statistically significant? So again, Clover assistant help, you know, PCP identifying CKD earlier and disease, you know, I just, I want a little bit more data. I want to know how they're doing this. Why what's different from Cerner and what's different from Epic? Because if I was a family medicine doctor right now, I want to know why should, you know, what's so special about you guys rather than just me keeping my EMR system, okay? Electronic medical record. Again, I'm not trying to be annoying here. I'm just giving you some insights from my experience. And for all the doctors, you guys are all like, yeah, yeah, yep, yep, exactly, right? Because it's an honest question, okay? All right, so I hope they can answer that. And here's, you know, here's my, you know, my electronic medical record asking me to download, you know, Citrix. All right, so let me just go ahead and quickly... Okay, so there it is. There's a quick overview of the PowerPoint. Now, after this, we're going to go ahead and listen to the earnings report. So overall, I'm going to go back up here. We posted this... One of our stock group members posted this yesterday at 8.40 p.m. yesterday. And he said essentially what he did is he was doing some due diligence on Clover. And one of our members, I think he posted it. We had a lot of discussion today in our – I can't wait to read it all – Yes. So one of our members here, Global Minded. So one of our members posted about it and then Global Minded said, forgive me for my ignorance. No, no ignorance. This is very hard stuff. So please ask questions because that's an important question. So overall, these are for your options, people that like to trade. The straddle costs $21. So what this does is you can look at any stock. It basically analyzes and uses implied volatility. Now, for all the options, people out there are like, yeah, yeah, I know implied volatility. It uses that and it estimates the next earnings report movement. So it estimates it. And the estimated earnings report movement that our stock terminal was able to calculate was 16%. So if you go ahead and go to Clover, But a closed stock, we're literally, and to be quite frankly honest, we hit near 16% today, if you don't remember. We went up high, but overall 15%. So we were definitely close. And this is very nice for option traders and people that want to make, again, you know, definitely have at least five years in the market, right? This is something that is very difficult to understand, right? It's very risky. Okay, so let's go ahead. Without further ado, let's remove this and let's share and let's listen to the earnings report together. Entire screen. All right, so let me know. I'm going to drink some water. All right. Let me know if you guys hear this. I'm going to mute myself. Please let me know if you hear this.

Chief Financial Officer.

Good morning, ladies and gentlemen, and welcome to the Clover Health fourth quarter and full year 22 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the prepared remarks. At that time, if you wish to ask a question, please press star one on your telephone keypad. As a reminder, today's call is being recorded. I would now like to turn the call over to Ryan Schmidt, Investor Relations for Clover Health. Please go ahead.