Lemonade (LMND) AI Stock Analysis

• Market Cap: $3.87B
• Dividend Yield: N/A
• Average Volume (3M): 2.62M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.05
• Revenue Growth: 22.91%
• EPS Growth: 4.95%
• Country: US
• Employees: 1,235
• Sector: Financial
• Sector Strength: 71
• Industry: Insurance - Property & Casualty
• EPS (TTM): -0.60
• Shares Outstanding: 73,886,410
• 10 Day Avg. Volume: 4,011,773
• 30 Day Avg. Volume: 2,617,328
• PEG Ratio: 0.80
• Price to Book (P/B): 4.39
• Price to Sales (P/S): 4.95
• P/FCF Ratio: -125.25
• Enterprise Value/Market Cap: 0.87
• Enterprise Value/Revenue: 5.59
• Enterprise Value/Gross Profit: 19.28
• Enterprise Value/Ebitda: -22.30
• 1Y Price Target: $38.67
• Price Target Upside: -26.16% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 8

• Rating: 59 Neutral
• Price Target: $49.00 ▼(-6.43% Downside)

Lemonade's overall stock score is driven by strong earnings call results and positive technical indicators. However, the company's financial performance and valuation are significant concerns due to persistent losses and negative cash flow. The bullish technical trend and strategic improvements in key markets provide some optimism, but the lack of profitability and high valuation risk weigh heavily on the score.

Positive Factors

Insurance retention

Lemonade reduced the ceded proportion of its quota share reinsurance from ~55% to ~20%, which should allow the company to retain more premiums over time.

Revenue growth

Revenue grew 35%, to $164 million, above the $161 million estimate, reflecting favorable ceding commissions.

Negative Factors

Market competition

The current market conditions with tariffs, intensified competition from incumbents, and macro uncertainties pose challenges for Lemonade.

Profitability timeline

Lemonade is still several years away from achieving GAAP net income profit.

Lemonade Business Overview & Revenue Model

Company Description

Lemonade, Inc. provides various insurance products in the United States and Europe. Its insurance products include stolen or damaged property, and personal liability that protects its customers if they are responsible for an accident or damage to another person or their property. The company also offers renters, homeowners, pet, car, and life insurance products, as well as landlord insurance policies. In addition, it operates as an agent for other insurance companies. The company was formerly known as Lemonade Group, Inc. and changed its name to Lemonade, Inc. Lemonade, Inc. was incorporated in 2015 and is headquartered in New York, New York.

How the Company Makes Money

Lemonade makes money primarily through the premiums paid by its policyholders. The company employs an innovative business model where a fixed percentage of premiums is allocated to cover operating costs and profits, while the remaining funds are used to pay out claims. This structure is intended to align the company's interests with its customers, as surplus funds are donated to charitable causes chosen by policyholders. Lemonade utilizes advanced machine learning algorithms to streamline processes, reduce fraud, and enhance customer experience, which contributes to cost efficiency and competitive pricing. Significant partnerships with reinsurance providers help Lemonade manage risk and ensure financial stability, further supporting its revenue model.

Lemonade Financial Statement Overview

Summary

Lemonade demonstrates strong revenue growth but struggles with profitability and cash flow. The balance sheet is solid with low leverage, but persistent losses and negative free cash flow indicate a need for better cost control and operational efficiency.

Income Statement

Lemonade's income statement shows significant revenue growth, with total revenue increasing from $94.4 million in 2020 to $409.6 million in TTM 2025. However, the company has not achieved profitability, as evidenced by persistent negative net income and EBIT margins. The gross profit margin remains high, which is positive, but the negative net profit margin indicates a need to control operating expenses and improve efficiency.

Balance Sheet

The balance sheet reflects a strong equity position relative to debt, with a debt-to-equity ratio remaining low. However, stockholders' equity has decreased over time, and the return on equity is negative due to ongoing losses. The equity ratio remains stable, indicating a decent financial structure, but the company must address its continuous losses to enhance financial stability.

Cash Flow

Lemonade's cash flow statement shows negative free cash flow, although there is improvement in recent periods. The operating cash flow remains negative, highlighting challenges in generating cash from operations. The company has relied on financing activities to support its cash position. Improving free cash flow to net income ratio is essential for future financial health.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	600.70M	526.50M	429.80M	256.70M	128.40M	94.40M
Gross Profit	174.30M	172.70M	90.20M	28.40M	22.90M	20.40M
EBITDA	-150.70M	-183.90M	-209.80M	-282.60M	-229.90M	-119.10M
Net Income	-204.00M	-202.20M	-236.90M	-297.80M	-241.30M	-122.30M
Balance Sheet
Total Assets	1.93B	1.85B	1.63B	1.69B	1.51B	828.70M
Cash, Cash Equivalents and Short-Term Investments	386.00M	1.01B	264.50M	1.03B	1.07B	577.40M
Total Debt	0.00	107.20M	43.10M	35.20M	22.30M	0.00
Total Liabilities	1.41B	1.26B	924.40M	823.90M	522.30M	287.70M
Stockholders Equity	527.10M	593.40M	708.90M	866.80M	988.20M	541.00M
Cash Flow
Free Cash Flow	-21.40M	-20.80M	-128.30M	-173.10M	-154.00M	-96.10M
Operating Cash Flow	-11.60M	-11.40M	-119.10M	-163.00M	-144.60M	-91.70M
Investing Cash Flow	-62.40M	40.60M	88.70M	181.10M	-804.80M	50.10M
Financing Cash Flow	102.70M	87.70M	15.40M	3.60M	649.60M	341.10M

Lemonade Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 52.37
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LMND, the sentiment is Positive. The current price of 52.37 is above the 20-day moving average (MA) of 42.58, above the 50-day MA of 41.56, and above the 200-day MA of 35.80, indicating a bullish trend. The MACD of 2.90 indicates Negative momentum. The RSI at 69.88 is Neutral, neither overbought nor oversold. The STOCH value of 89.47 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LMND.

Lemonade Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SKWD	73 Outperform	$1.98B	15.44	16.20%	―	22.20%	5.78%
HCI	72 Outperform	$2.00B	13.68	23.90%	1.04%	9.62%	-18.69%
STC	71 Outperform	$1.90B	21.87	6.27%	2.94%	14.00%	100.44%
ROOT	68 Neutral	$1.23B	18.60	27.52%	―	59.76%	―
SAFT	64 Neutral	$1.08B	12.66	10.08%	4.98%	18.52%	65.66%
LMND	59 Neutral	$3.87B	―	-35.10%	―	22.91%	4.95%
Sector *	58 Neutral	HK$110.80B	6.36	-4.20%	4.00%	8.89%	-46.47%

Lemonade Corporate Events

Lemonade Announces New Reinsurance Program Terms

Lemonade, Inc. announced the terms of its reinsurance program effective from July 1, 2025, to June 30, 2026, involving a reduction in the ceded proportion of its quota share reinsurance from approximately 55% to 20%. This strategic move is expected to maintain a variable ceding commission rate similar to previous agreements, potentially impacting the company’s financial strategy and stakeholder interests.

The most recent analyst rating on (LMND) stock is a Hold with a $44.00 price target. To see the full list of analyst forecasts on Lemonade stock, see the LMND Stock Forecast page.

Lemonade Elects New Directors at Annual Meeting

On June 4, 2025, Lemonade held its annual meeting of stockholders, with 68.41% of the voting power represented. During the meeting, Shai Wininger and Dr. Samer Haj-Yehia were elected as Class II Directors until 2028. Additionally, the appointment of Ernst & Young LLP as the independent registered public accounting firm for 2025 was ratified, and the compensation of the company’s named executive officers was approved on a non-binding basis.

The most recent analyst rating on (LMND) stock is a Hold with a $44.00 price target. To see the full list of analyst forecasts on Lemonade stock, see the LMND Stock Forecast page.