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LMND vs. EVER: Which InsurTech Stock Is the Better Pick?
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Key Takeaways
LMND targets adjusted EBITDA breakeven by 2026, backed by diversification and premium growth.
EVER's ROE of 38.2% outperforms the industry, supported by innovation and a debt-free balance sheet.
Both LMND and EVER shares have surged 116% YTD, but EVER shows stronger profitability and EPS growth.
InsurTechs — technology-led insurers — are trying hard to be game changers, leveraging technologies like AI, telematics, data-driven underwriting and machine learning, among others. Yet, Lemonade Inc. (LMND - Free Report) and EverQuote Inc. (EVER - Free Report) — two U.S.-based insurTech companies — continue to face challenges due to lowered interest rate, increased competition, inflation, higher cost of repair and increased pressure to achieve and sustain profitability. Given heightened regulatory scrutiny with respect to data and pricing models, InsurTechs are looking to invest in regtech solutions to overcome compliance-related challenges.
InsurTechs use the latest technologies and concepts. However, traditional insurers are also undergoing accelerated digitalization, limiting the advantage these InsurTechs enjoyed earlier.
Coming back to LMND and EVER, let’s examine their fundamentals closely to determine which one is more attractive as an investment option.
The Case for LMND
Lemonade has broadened its business beyond renters and homeowners insurance by expanding into auto insurance through the Metromile acquisition, as well as pet and life coverage. This diversification strengthens its revenue base and reduces dependence on any single product line. The company’s strong customer retention and subscription-driven model support recurring revenue growth, as policyholders remain engaged and gradually add new insurance products. Management projects 2025 revenues in the range of $727 million to $732 million.
The auto segment continues to outperform expectations, with management anticipating accelerating growth driven by total addressable market expansion from new state launches and increased brand and growth investments. Third-quarter in-force premium (IFP) reached $1.16 billion, marking the eighth consecutive quarter of accelerating growth. This momentum was supported by a compelling product lineup and AI-driven enhancements in pricing and risk segmentation. Management expects year-end IFP of $1.218 billion to $1.223 billion and projects IFP growth of 30% in fiscal 2026.
Lemonade’s reinsurance structure plays a key role in stabilizing financial performance by transferring a meaningful portion of claims costs to reinsurance partners, thereby reducing earnings volatility. As a technology-focused insurer, the company continues to invest heavily in digitization and automation. These efforts have delivered tangible benefits, with loss adjustment expenses averaging just 7% of premiums across products—an impressive level of efficiency, given the company’s smaller scale relative to major U.S. insurers. Over the past three years, Lemonade has improved its LAE ratio by 600 basis points.
Geographic expansion remains another important growth driver. Its European presence diversifies revenue opportunities beyond the United States, offering lower catastrophe exposure and operating within a more favorable regulatory environment.
However, Lemonade is yet to be profitable. But with improved margins, positive free cash flow and disciplined expense control, management targets adjusted EBITDA breakeven by 2026.
Shares of LMND have rallied 116% year to date. Its return on equity of negative 31.9% lags the industry average.
The Case for EVER
EverQuote is well positioned for long-term growth, supported by its proprietary data platform, increased focus on property and casualty insurance, and a leaner operating structure. Lower advertising costs, rising digital adoption across the insurance industry, and a strong balance sheet further reinforce its growth outlook. As auto carrier demand begins to normalize, the company is positioned to regain momentum in its core auto marketplace, which also serves as a foundation for expansion into additional insurance verticals with higher engagement and quote activity.
The company continues to invest in innovation to enhance monetization and deepen relationships with advertisers. EverQuote plans to deploy strong cash flow into AI, technology, and data initiatives to improve efficiency and strengthen its competitive moat. Its platform is being enhanced through the integration of proprietary data with in-house, third-party, and open-source tools to attract insurance shoppers across multiple channels. AI is increasingly embedded throughout operations, including copilots, voice agents, automated workflows and advanced machine learning systems.
Inorganic growth remains an important contributor. The acquisition of PolicyFuel expanded EverQuote’s product offerings, strengthened support for P&C carrier partners, and improved personalized shopping experiences for consumers. The transaction also increased EverQuote’s exposure to the $135 billion commission-based total addressable market within insurance distribution as more spending shifts online.
In addition, EverQuote has authorized a $50 million share repurchase program through June 2026, underscoring management’s confidence in the company’s performance, cash position, and disciplined capital allocation strategy.
The company boasts a debt-free balance sheet, with the cash balance improving over the last three years. Shares of EVER have rallied 116% year to date. Its return on equity of 38.2% outperforms the industry average.
Estimates for LMND and EVER
The Zacks Consensus Estimate for LMND’s 2025 revenues implies a year-over-year increase of 38.6% while that for EPS implies a year-over-year increase 17.2%. EPS estimates have moved northward over the past 30 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for EVER’s 2025 revenues implies a year-over-year increase of 34.8% while that for EPS implies a year-over-year increase 65.9%. EPS estimates have moved northward over the past 30 days.
Image Source: Zacks Investment Research
Are LMND and EVER Shares Expensive?
LMND is trading at a price-to-book multiple of 11.65, above its median of 1.85 over the last three years. EVER’s price-to-book multiple sits at 5.6, above its median of 5.26 over the last three years.
Image Source: Zacks Investment Research
Conclusion
Lemonade is driving growth through acquisitions of profitable businesses and a strong focus on car insurance as a key growth engine. Alongside renters, homeowners, pet, and life insurance, the company aims to expand its market presence. By leveraging technology and AI to improve efficiency and scalability, Lemonade targets 30% growth in in-force premiums in 2026 toward its tenfold growth ambition, though it has not yet achieved profitability.
EverQuote can sustain growth beyond its auto marketplace by expanding into non-auto insurance, launching new products, and pursuing selective acquisitions to diversify revenue. Leveraging its technology to attract high-intent consumers will further strengthen its competitive position in the digital insurance market.
On the basis of return on equity, which reflects a company’s efficiency in generating profit from shareholders' equity as well as gives a clear picture of the company's financial health, EVER scores higher than LMND.
EVER stock sports a Zacks Rank #1 (Strong Buy), while LMND carries a Zacks Rank #3 (Hold). Clearly, EVER seems a better pick than Lemonade now.
Image: Bigstock
LMND vs. EVER: Which InsurTech Stock Is the Better Pick?
Key Takeaways
InsurTechs — technology-led insurers — are trying hard to be game changers, leveraging technologies like AI, telematics, data-driven underwriting and machine learning, among others. Yet, Lemonade Inc. (LMND - Free Report) and EverQuote Inc. (EVER - Free Report) — two U.S.-based insurTech companies — continue to face challenges due to lowered interest rate, increased competition, inflation, higher cost of repair and increased pressure to achieve and sustain profitability. Given heightened regulatory scrutiny with respect to data and pricing models, InsurTechs are looking to invest in regtech solutions to overcome compliance-related challenges.
InsurTechs use the latest technologies and concepts. However, traditional insurers are also undergoing accelerated digitalization, limiting the advantage these InsurTechs enjoyed earlier.
Coming back to LMND and EVER, let’s examine their fundamentals closely to determine which one is more attractive as an investment option.
The Case for LMND
Lemonade has broadened its business beyond renters and homeowners insurance by expanding into auto insurance through the Metromile acquisition, as well as pet and life coverage. This diversification strengthens its revenue base and reduces dependence on any single product line. The company’s strong customer retention and subscription-driven model support recurring revenue growth, as policyholders remain engaged and gradually add new insurance products. Management projects 2025 revenues in the range of $727 million to $732 million.
The auto segment continues to outperform expectations, with management anticipating accelerating growth driven by total addressable market expansion from new state launches and increased brand and growth investments. Third-quarter in-force premium (IFP) reached $1.16 billion, marking the eighth consecutive quarter of accelerating growth. This momentum was supported by a compelling product lineup and AI-driven enhancements in pricing and risk segmentation. Management expects year-end IFP of $1.218 billion to $1.223 billion and projects IFP growth of 30% in fiscal 2026.
Lemonade’s reinsurance structure plays a key role in stabilizing financial performance by transferring a meaningful portion of claims costs to reinsurance partners, thereby reducing earnings volatility. As a technology-focused insurer, the company continues to invest heavily in digitization and automation. These efforts have delivered tangible benefits, with loss adjustment expenses averaging just 7% of premiums across products—an impressive level of efficiency, given the company’s smaller scale relative to major U.S. insurers. Over the past three years, Lemonade has improved its LAE ratio by 600 basis points.
Geographic expansion remains another important growth driver. Its European presence diversifies revenue opportunities beyond the United States, offering lower catastrophe exposure and operating within a more favorable regulatory environment.
However, Lemonade is yet to be profitable. But with improved margins, positive free cash flow and disciplined expense control, management targets adjusted EBITDA breakeven by 2026.
Shares of LMND have rallied 116% year to date. Its return on equity of negative 31.9% lags the industry average.
The Case for EVER
EverQuote is well positioned for long-term growth, supported by its proprietary data platform, increased focus on property and casualty insurance, and a leaner operating structure. Lower advertising costs, rising digital adoption across the insurance industry, and a strong balance sheet further reinforce its growth outlook. As auto carrier demand begins to normalize, the company is positioned to regain momentum in its core auto marketplace, which also serves as a foundation for expansion into additional insurance verticals with higher engagement and quote activity.
The company continues to invest in innovation to enhance monetization and deepen relationships with advertisers. EverQuote plans to deploy strong cash flow into AI, technology, and data initiatives to improve efficiency and strengthen its competitive moat. Its platform is being enhanced through the integration of proprietary data with in-house, third-party, and open-source tools to attract insurance shoppers across multiple channels. AI is increasingly embedded throughout operations, including copilots, voice agents, automated workflows and advanced machine learning systems.
Inorganic growth remains an important contributor. The acquisition of PolicyFuel expanded EverQuote’s product offerings, strengthened support for P&C carrier partners, and improved personalized shopping experiences for consumers. The transaction also increased EverQuote’s exposure to the $135 billion commission-based total addressable market within insurance distribution as more spending shifts online.
In addition, EverQuote has authorized a $50 million share repurchase program through June 2026, underscoring management’s confidence in the company’s performance, cash position, and disciplined capital allocation strategy.
The company boasts a debt-free balance sheet, with the cash balance improving over the last three years. Shares of EVER have rallied 116% year to date. Its return on equity of 38.2% outperforms the industry average.
Estimates for LMND and EVER
The Zacks Consensus Estimate for LMND’s 2025 revenues implies a year-over-year increase of 38.6% while that for EPS implies a year-over-year increase 17.2%. EPS estimates have moved northward over the past 30 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for EVER’s 2025 revenues implies a year-over-year increase of 34.8% while that for EPS implies a year-over-year increase 65.9%. EPS estimates have moved northward over the past 30 days.
Image Source: Zacks Investment Research
Are LMND and EVER Shares Expensive?
LMND is trading at a price-to-book multiple of 11.65, above its median of 1.85 over the last three years. EVER’s price-to-book multiple sits at 5.6, above its median of 5.26 over the last three years.
Image Source: Zacks Investment Research
Conclusion
Lemonade is driving growth through acquisitions of profitable businesses and a strong focus on car insurance as a key growth engine. Alongside renters, homeowners, pet, and life insurance, the company aims to expand its market presence. By leveraging technology and AI to improve efficiency and scalability, Lemonade targets 30% growth in in-force premiums in 2026 toward its tenfold growth ambition, though it has not yet achieved profitability.
EverQuote can sustain growth beyond its auto marketplace by expanding into non-auto insurance, launching new products, and pursuing selective acquisitions to diversify revenue. Leveraging its technology to attract high-intent consumers will further strengthen its competitive position in the digital insurance market.
On the basis of return on equity, which reflects a company’s efficiency in generating profit from shareholders' equity as well as gives a clear picture of the company's financial health, EVER scores higher than LMND.
EVER stock sports a Zacks Rank #1 (Strong Buy), while LMND carries a Zacks Rank #3 (Hold). Clearly, EVER seems a better pick than Lemonade now.
You can see the complete list of today’s Zacks #1 Rank stocks here.