eHealth, Inc.
| Company Name | eHealth, Inc. |
| Stock Symbol | EHTH |
| Class Period | March 19, 2018 to April 07, 2020 |
| Lead Plaintiff Motion Deadline | June 08, 2020 |
On April 8, 2020, Muddy Waters Research published a report alleging, among other things, that eHealth misled investors regarding member churn and revenue recognition. The report stated that the Company's “member churn . . . skyrocketed” and “that EHTH is pursuing low quality, lossmaking growth while its LTVs are based on lower churn, pre-growth cohorts.”
On this news, eHealth's stock price fell $12.82, nearly 12%, to close at $103.20 per share on April 8, 2020, thereby injuring investors.
The complaint alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose: (1) its highly aggressive accounting and modeling assumptions; (2) its skyrocketing rate of member churn, resulting from eHealth’s pursuit of low quality, lossmaking growth; (3) its reliance on direct response television advertising, which attracts an unprofitable, high churn enrollee; and (4) as a result of the foregoing, Defendants’ public statements were materially false and misleading at all relevant times.
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