CLEAR to Take Off: 1 Stock with Massive Market Size

Clear Secure, or CLEAR, is a member-centric secure identity platform that is striving to revolutionize how people verify their identity wherever they go.

CLEAR generates revenue through its consumer aviation subscription service, CLEAR Plus, which provides members with fast and predictable experiences at airport security checkpoints across the country through the use of touchless biometric verification technology.

The company had a tumultuous past, filing for bankruptcy in 2009, but has since recovered with its current version going public in July 2021 and raising $376 million.

More recently, revenues have been on the rise with rapid year-over-year growth evident with each quarterly earnings report. Revenue growth quarterly has been very impressive:

  • Q4 2021: 51.7%
  • Q1 2022: 79.1%
  • Q2 2022: 86.2%
  • Q3 2022: 71.6%

Revenues on an absolute basis have been growing handsomely over the past twelve months:

  • Q4 2021: $80.7M
  • Q1 2022: $90.5M
  • Q2 2022: $102.7M
  • Q3 2022: $115.9M

Air travel has been the first vertical conquered by clear by others are ripe for the picking. According to the company’s S-1 Hospitality, Healthcare, Location Access, and Sports and Entertainment are all in its sights:

    • Aviation and Travel: According to an Airlines for America survey from 2017, around 90 million American adults fly at least twice per year and around 31 million fly at least six times per year. CLEAR believes the size of the domestic aviation and travel markets provide a significant opportunity to use its platform to increase membership.
    • Hospitality: In 2020, the company announced a partnership with MGM Resorts to facilitate the safe return of meetings and conventions at the company’s properties in the US through its Health Pass offering. CLEAR believes this partnership demonstrates how its platform can enable seamless experiences in the hospitality industry.
    • Live Sports and Entertainment: According to ESPN, there were around 130 million sports attendees in 2019 across the NFL, NBA, MLB, and NHL. Similarly, live music entertainment attracted nearly 60 million attendees in 2019, according to Statista. CLEAR believes each of these attendance instances represents a verification opportunity for its platform.
    • Healthcare: CLEAR believes its secure identity platform has multiple uses in thousands of hospitals and doctors’ offices across the US, including patient check-in, digital medical records, telehealth, and verified identity. Based on data from the CDC, the company estimates that there are over one billion healthcare visits in the US annually.

By our analysis, the company has upside potential to $33 per share, suggesting 20% potential gain from current levels.