Is Clover Health (NASDAQ:CLOV) Stock a Good Buy Around $8 Level?

Some investors are putting their bets on Clover Health (NASDAQ:CLOV), believing that the share prices of the company will go high. The company’s stock  has a short-interest float at around 37% – which is a reason enough for this group of investors making it ideal for a short squeeze.

A chunk of people is of the belief that the company is set to become the future of the health insurance industry. They believe that Clover Assistant would become a part of the curriculum for both the medical and the teaching schools. However, there is very little to no evidence to support their argument.

On the other hand, many are worried about the company’s future. The fund that an insurance provider receives from the federal government is based on the quality of services provided by the former- the better the service offered, the higher the value of each patient. Clover health manages to provide to the low-margin segment in the Medicare market – causing a point of concern.

Moreover, Clover health also appears to be incurring more losses despite the increasing number of patients. This indicates the lack of pricing policy power with the company. Also, with the regulatory norms setting an upper limit to the service fees charged, there is little that can be done. The company’s use of AI to provide improved services might have helped the company’s case, however, the peers have also been using technology for the same.