Lemonade Declines 5% on Quarterly Loss


Shares of Lemonade Inc. (LMND) dipped 5.1% in Tuesday’s early trade after the insurance company reported a loss of $1.08 per share for the third quarter of 2021. The reported loss was, however, narrower than analysts’ expectations of a loss of $1.16 per share. The company had recorded a loss of $0.57 per share in the same quarter last year.

Revenue of $35.7 million increased 101% year-over-year and surpassed the Street’s expectations of $33.5 million. The upside was primarily due to higher gross earned premium and an increase in net investment income & commission income.

Meanwhile, In Force Premium (IFP) rose 84% year-on-year to $346.7 million at the end of the third quarter on the back of a 45% rise in customer count and a 26% increase in premium per customer.

Customer count increased 45% to 1,363,754. Premium per customer during the quarter stood at $254, up 26%. (See Lemonade stock charts on TipRanks)

Outlook 

For the fourth quarter, Lemonade expects to report revenue in the range of $39 million to $40 million. Also, IFP is projected to be between $380 million and $384 million.

For 2021, the company projects revenue of $126 million to $127 million against the consensus estimate of $124.3 million. LMND forecasts IFB to be between $380 million and $384 million.

Metromile Acquisition

Alongside earnings, Lemonade has announced its plans to acquire Metromile (MILE), a data science company focused on auto insurance, in an all-stock deal of $500 million. As per the terms, Metromile shareholders will receive Lemonade’s common shares at a ratio of 19:1.

The deal is expected to close in the second quarter of 2022, subject to necessary approvals.

Wall Street’s Take 

Consensus among analysts is a Hold based on 2 Buys, 2 Holds and 1 Sell. The average Lemonade price target of $84.60 implies 35.4% upside potential.

Website Traffic

TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Lemonade’s performance.

According to the tool, the number of total unique visitors for September 2021 on all devices stood at 1.6 million, up 32.05% year-over-year. On a year-to-date basis, the number of total unique visitors to the company’s website increased 68.1% from the comparable period last year.

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