Lemonade (LMND) AI Stock Analysis

• Market Cap: $6.17B
• Dividend Yield: N/A
• Average Volume (3M): 2.58M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.42
• Revenue Growth: 30.53%
• EPS Growth: 21.82%
• Country: US
• Employees: 1,235
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): -0.51
• Shares Outstanding: 74,731,026
• 10 Day Avg. Volume: 2,788,747
• 30 Day Avg. Volume: 2,575,514
• 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: 0.67
• Enterprise Value/Revenue: 6.26
• Enterprise Value/Gross Profit: 14.65
• Enterprise Value/Ebitda: -25.64
• 1Y Price Target: $64.60
• Price Target Upside: -21.80% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 6
• EPS Forecast (FY): -2.37
• Revenue Forecast (FY): $723.99M

• Rating: 60 Neutral
• Price Target: $81.00 ▼(-1.95% Downside)

Lemonade's overall stock score reflects a company with strong growth potential but significant profitability challenges. The positive technical indicators and promising earnings call insights are offset by valuation concerns and financial performance issues. The company's focus on operational efficiencies and strategic growth in the auto segment are key strengths, but achieving sustainable profitability remains a critical hurdle.

Positive Factors

Revenue Growth

Strong revenue growth indicates effective market penetration and product adoption, suggesting a robust business model and potential for sustained expansion.

Operational Efficiency

Operational efficiency through AI investments enhances cost management, potentially leading to improved margins and competitive advantage.

Cash Position

A strong cash position provides financial flexibility for strategic investments and resilience against market fluctuations, supporting long-term growth.

Negative Factors

Profitability Challenges

Ongoing profitability issues highlight operational challenges, which may hinder long-term financial sustainability and shareholder returns.

Home Insurance Segment Challenges

Struggles in the home insurance segment could affect customer retention and revenue stability, posing risks to overall business performance.

EBITDA Loss

Continued EBITDA losses indicate challenges in achieving operational profitability, which could impact long-term financial health and investment capacity.

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 generates revenue primarily through the sale of insurance policies, charging customers premiums that vary based on the type of coverage selected. The company employs a unique business model where it retains a fixed percentage of the premiums, which is then used to cover operational costs and claims. Any leftover funds after claims are paid out are allocated to charitable causes chosen by the policyholders through the company's Giveback program. Additionally, Lemonade earns revenue from reinsurance arrangements, where it transfers some of its risk to other insurance entities, allowing it to manage large claims while maintaining a stable financial foundation. Strategic partnerships with reinsurers and technology providers also contribute to its revenue stream by enhancing its underwriting capabilities and expanding its market reach.

Lemonade Financial Statement Overview

Summary

Lemonade's financial performance is mixed. Revenue growth is positive, but profitability remains a challenge with negative net profit and EBIT margins. The balance sheet is stable, yet increasing leverage and negative ROE are concerns. Cash flow management needs improvement, with negative free cash flow growth and insufficient operating cash flow.

Income Statement

Lemonade's income statement shows a mixed performance. The company has achieved a revenue growth rate of 7.54% in the TTM, indicating positive momentum. However, profitability remains a challenge with negative net profit and EBIT margins, reflecting ongoing operational losses. The gross profit margin has improved to 39.87%, suggesting better cost management, but the overall negative margins highlight the need for further efficiency improvements.

Balance Sheet

The balance sheet reflects a moderate financial position. The debt-to-equity ratio has increased to 0.27, indicating a rise in leverage, but it remains at a manageable level. The return on equity is negative, showing that the company is not currently generating returns for shareholders. The equity ratio of 27.24% suggests a stable capital structure, but the negative ROE highlights profitability concerns.

Cash Flow

Cash flow analysis reveals challenges in cash generation. The free cash flow growth rate is negative, indicating a decline in cash reserves. The operating cash flow to net income ratio is zero, reflecting insufficient cash flow to cover net losses. However, the free cash flow to net income ratio is positive, suggesting some ability to manage cash relative to net losses. Overall, cash flow management needs improvement to support business operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	658.60M	526.50M	429.80M	256.70M	128.40M	94.40M
Gross Profit	281.40M	172.70M	90.20M	28.40M	22.90M	20.40M
EBITDA	-160.80M	-183.90M	-209.80M	-282.60M	-229.90M	-119.10M
Net Income	-173.80M	-202.20M	-236.90M	-297.80M	-241.30M	-122.30M
Balance Sheet
Total Assets	1.92B	1.85B	1.63B	1.69B	1.51B	828.70M
Cash, Cash Equivalents and Short-Term Investments	355.50M	1.01B	937.70M	1.03B	1.07B	577.40M
Total Debt	0.00	107.20M	43.10M	35.20M	22.30M	0.00
Total Liabilities	1.40B	1.26B	924.40M	823.90M	522.30M	287.70M
Stockholders Equity	516.20M	593.40M	708.90M	866.80M	988.20M	541.00M
Cash Flow
Free Cash Flow	-32.90M	-20.80M	-128.30M	-173.10M	-154.00M	-96.10M
Operating Cash Flow	-23.40M	-11.40M	-119.10M	-163.00M	-144.60M	-91.70M
Investing Cash Flow	-67.70M	40.60M	88.70M	181.10M	-804.80M	50.10M
Financing Cash Flow	103.10M	87.70M	15.40M	3.60M	649.60M	341.10M

Lemonade Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 82.61
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 82.61 is above the 20-day moving average (MA) of 77.12, above the 50-day MA of 67.78, and above the 200-day MA of 47.72, indicating a bullish trend. The MACD of 3.53 indicates Positive momentum. The RSI at 60.33 is Neutral, neither overbought nor oversold. The STOCH value of 67.86 is Neutral, 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
PLMR	83 Outperform	$3.58B	21.05	22.24%	―	54.41%	52.71%
PGR	78 Outperform	$131.52B	12.29	34.23%	2.20%	18.35%	32.36%
ROOT	70 Neutral	$1.15B	23.69	17.02%	―	38.50%	―
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
LMND	60 Neutral	$6.17B	-34.77	-31.34%	―	30.53%	21.82%
KMPR	52 Neutral	$2.39B	10.65	9.03%	3.14%	4.51%	-8.29%

Lemonade Corporate Events

Lemonade Appoints Prashant Ratanchandani as New Director

On October 15, 2025, Lemonade‘s Board appointed Mr. Prashant Ratanchandani as a Class II director, effective immediately. He will serve until the 2028 annual meeting of stockholders, unless earlier replaced. Mr. Ratanchandani is eligible for the company’s Non-Employee Director Compensation Policy, which includes a cash retainer and equity-based awards. There are no familial or material transactional relationships involving Mr. Ratanchandani and the company’s directors or executives.

Lemonade Appoints Geoff Seeley as New Director

On October 6, 2025, Lemonade‘s Board appointed Mr. Geoff Seeley as a Class I director, with his term expiring at the 2027 annual meeting of stockholders. Mr. Seeley will receive compensation under the company’s Non-Employee Director Compensation Policy, including an annual cash retainer and equity-based awards. There are no family or material interests influencing his appointment.