Risk/Reward Rating: Negative
Lemonade reported increasing losses in Q2 2021 on August 4. The net loss grew 165% versus Q2 of 2020 to $55.6 million while revenue declined 5% versus 2020. The stock price has declined 17% since our last update on June 20, 2021.
For those unfamiliar with the story, Lemonade is an insurance company that started by specializing in renters insurance and is now expanding into homeowners, pet, and life insurance primarily in the United States. The company has additional near-term expansion plans to enter the auto insurance market and a regional push across business lines into the European market. The current business mix is 50% renters insurance, 30% homeowners, 13% pet, and 1% life insurance.
The company is unprofitable and is expected to remain so for the foreseeable future.
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