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Does GoHealth’s Unhealthy Stock Performance Make it a Buy?

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Back in July 2020, GoHealth (NASDAQ: GOCO) was being touted as the next major player in the online health insurance space. Eleven months later, some investors are wondering if the company will even survive.

Since making their Nasdaq debut at $25, GoHealth shares have gone in only one direction—down. Now trading in penny stock territory at less than $5, a company that once seemed to have all the answers now seems to be at a loss for words.

All hope is not lost though. Despite the poor stock performance, there are some positive underlying trends in the business that could support a turnaround in 2022. If management can navigate the near-term challenges related to staffing and costs, GoHealth’s current price could turn out to be a healthy bargain.

After the close on August 11th, GoHealth reported second-quarter results that beat modestly on the top and bottom lines. Revenue increased 55% to $196.9 million and the $0.03 per share net loss was a couple of pennies better than analysts expected.

So, the Q2 diagnosis was benign, but management’s outlook for full-year profits was a sore point with the market. Due to tight labor market conditions and the need for enhanced training, GoHealth’s........

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