Investing

Earnings Previews: Clover Health, Coinbase, Lordstown Motors

Today’s look at earnings reports due the end of this week and the start of next week begins with a company we missed in our preview yesterday that will be reporting results after markets close Thursday. Two other closely followed companies report results before markets open Monday. There are no earnings reports of interest on Friday.

Looking at the other companies reporting earnings following Thursday’s close, we are awaiting results from Airbnb, Aurora Cannabis, Blink, Disney and Luminar.

Coinbase

Coinbase Global Inc. (NASDAQ: COIN) has been a publicly traded company for only a month, but it will report first-quarter earnings after markets close Thursday. In case you’ve been living under a rock for the past year or so, you’ll know that Coinbase is the largest of the exchanges for cryptocurrencies. It came public in a direct listing with a reference price of $250 a share and closed its first day of trading at $328.28. That worked out to a market cap of $85.8 billion. Since the IPO, however, the stock has traded down about 18% and the market cap has dropped to a paltry $57.4 billion.

Analysts covering the stock are mostly bullish, with six of nine rating Coinbase a Buy. The average price target is about $420, implying upside potential at the current price of around $270 of 56%. At the high target of $650, upside potential soars to 140%.

For the first quarter, consensus estimates call for earnings per share (EPS) of $3.09 on revenue of $1.81 billion. For the full fiscal year, analysts are looking for EPS of $6.93 and sales of $5.42 billion.

At the current price, the stock trades at around 39.0 times expected 2021 EPS and 61.6 times estimated 2022 earnings. Shares are trading down about 4% in the noon hour Thursday, at $272.01 in a post-IPO range of $250.51 to $429.54. The average daily trading volume on the stock is about 13.3 million shares.

Clover Health

Medicare Advantage provider Clover Health Investments Corp. (NASDAQ: CLOV), which came public in early January through a SPAC merger, has seen its stock drop in value by nearly 54%. Partly that was due to a short seller attack on the company and partly it was due to a proposed change in SEC rules that requires companies to account for warrants as liabilities rather than assets. Because Clover Health issued warrants as part of its IPO, the company is likely to have to restate prior results and that could take a toll on its outlook. The company is set to report results before markets open Monday morning.

The stock gets only light coverage, with two of four brokerages rating the shares a Buy. At a recent price of around $7.50, upside potential based on an average price target of $13.25 is about 77%. At the high target of $15, the share price would double.

For the March quarter, consensus estimates call for a per-share loss of $0.11 on revenue of $192.57 million. For the full year, the company is expected to post a loss per share of $0.41 on revenue of $822.49 million.

Clover Health is not expected to post a profit in 2021 or 2022. The stock trades at a multiple of 4.4 times expected 2021 enterprise value-to-sales (EV/S) and 3.0 times estimated 2022 EV/S. The 52-week range is $6.31 to $17.45, and Clover Health’s average daily trading volume is nearly 23.5 million shares.

Lordstown Motors

Electric vehicle (EV) maker Lordstown Motors Corp. (NASDAQ: RIDE) came public in October of last year in a SPAC merger that showered Lordstown with some $675 million in cash to help it deliver its first Endurance pickup trucks by the fall. On Wednesday, the New York Times detailed several of the company’s problems, including an SEC investigation related to the number of pre-orders the company said it had for its new trucks. Lordstown’s announcement of those pre-orders led to a short seller attack in March. The stock is down nearly 63% since the IPO.

Surprisingly, perhaps, only one of six brokerage firms rates the Stock a Sell, while three give the stock a Hold rating and two set their rating at Buy. The average price target is $21.33, and with shares trading currently at around $7.00, that’s potential upside of nearly 300%. The stock last traded at near that price target in late February.

Analysts expect the company to post a loss per share of $0.28 for the quarter on essentially no revenue. For the full year, the loss per share is expected to reach $1.68 on revenue of $92.3 million.

Lordstown is not expected to post a profit in either 2021 or 2022. The stock trades at a multiple of 7.6 times expected 2021 EV/S and 0.5 times estimated 2022 EV/S. The stock’s 52-week range is $6.69 to $31.80, and the average daily trading volume is about 8.5 million shares.