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SelectQuote (SLQT)
NYSE:SLQT
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SelectQuote
(NYSE:SLQT)
Rating:58Neutral
Price Target:
$2.50
▲(15.74%Upside)
SelectQuote (SLQT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$373.08M
Dividend YieldN/A
Average Volume (3M)1.13M
Price to Earnings (P/E)―
Beta (1Y)1.16
Revenue Growth20.41%
EPS Growth93.09%
CountryUS
Employees4,292
SectorFinancial
Sector Strength74
IndustryInsurance - Brokers
Share Statistics
EPS (TTM)0.11
Shares Outstanding172,721,270
10 Day Avg. Volume896,604
30 Day Avg. Volume1,127,299
Financial Highlights & Ratios
PEG Ratio0.07
Price to Book (P/B)0.93
Price to Sales (P/S)0.00
P/FCF Ratio-11.37
Enterprise Value/Market Cap2.61
Enterprise Value/Revenue0.17
Enterprise Value/Gross Profit1.26
Enterprise Value/Ebitda2.59
Forecast
1Y Price Target
$5.58Price Target Upside158.33% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
SelectQuote Business Overview & Revenue Model
Company DescriptionSelectQuote, Inc. operates a technology-enabled, direct-to-consumer distribution platform that sells a range of insurance policies to consumers from various insurance carriers in the United States. The company operates through three segments: Senior; Life; and Auto & Home. It distributes senior health policies, such as medicare advantage, medicare supplement, medicare part D, and other ancillary senior health insurance related policies, including prescription drugs, dental, vision, and hearing plans; term life policies; and non-commercial auto and home property, and casualty policies. The company was incorporated in 1999 and is headquartered in Overland Park, Kansas.
How the Company Makes MoneySelectQuote makes money primarily through commission fees paid by insurance carriers for the policies sold through its platform. When a customer purchases an insurance policy via SelectQuote, the company earns a commission from the insurance carrier, which is typically a percentage of the policy's premium. Additionally, SelectQuote may receive renewal commissions if a customer continues to renew their policy. The company also benefits from significant partnerships with various insurance carriers, which enhance its product offerings and customer reach. By leveraging its technology platform, SelectQuote aims to optimize the customer acquisition process and increase conversion rates, thereby boosting its revenue.
SelectQuote Earnings Call Summary
Earnings Call Date:May 12, 2025
(Q3-2025)
| % Change Since: -19.10%|
Next Earnings Date:Sep 10, 2025
Earnings Call Sentiment Neutral
SelectQuote's earnings call reveals a strong overall performance with notable revenue and membership growth, especially in the SelectRx and Life Insurance segments. Despite challenges in the Medicare Advantage market and legal issues, the company's profitability and efficiency metrics show promising trends. The sentiment is balanced with significant achievements countered by legal and operational challenges.Q3-2025 Updates
Positive Updates
Revenue Growth
SelectQuote reported third quarter revenues of $408 million, an 8% increase compared to the previous year, driven by strong member onboarding in the SelectRx business.
SelectRx Membership Increase
SelectRx membership grew to nearly 106,000 members, representing a 41% increase compared to a year ago, contributing to $675 million in trailing 12-month revenues.
Life Insurance Segment Performance
Life Insurance revenues grew by 13%, with profits more than doubling compared to a year ago, demonstrating strong top and bottom-line performance.
Efficient Customer Acquisition
The company's trailing 12-month revenue to customer acquisition cost (CAC) was 5.8x, compared to 4.2x a year ago, indicating improved marketing efficiency.
Senior Segment Margins
The Senior segment delivered a 27% margin despite a 26% smaller agent force, showing impressive efficiency and execution during a challenging Medicare Advantage season.
Negative Updates
Challenges in Medicare Advantage Environment
The agent force was reduced by 26% during the Medicare Advantage season, resulting in a 10% decrease in policy volumes and impacting profitability.
Healthcare Services Margin Pressure
While Healthcare Services showed growth, profitability lagged due to investments in growth and facility expansion, leading to anticipated short-term EBITDA headwinds.
Legal Challenges
SelectQuote is facing a Department of Justice complaint regarding Medicare Advantage practices, which the company plans to vigorously defend.
Company Guidance
During SelectQuote's fiscal third quarter earnings call, the company reported a consolidated revenue of $408 million, reflecting an 8% increase year-over-year. This growth was primarily driven by a robust 41% increase in membership in the SelectRx business, now totaling nearly 106,000 members. The SelectRx segment achieved trailing 12-month revenues of approximately $675 million. The company's consolidated EBITDA for the quarter was $38 million, maintaining strong margins despite a shift in business mix, with a notable 27% margin in the Senior segment. The Life Insurance segment also performed well, with revenues growing by 13% and profits more than doubling compared to the previous year. SelectQuote's trailing 12-month revenue to customer acquisition cost (CAC) ratio improved to 5.8x, up from 4.2x a year ago, highlighting enhanced marketing efficiency. The company plans to focus on increasing profitability in its Healthcare Services segment and anticipates some near-term headwinds from the expansion of its new Kansas facility. Overall, SelectQuote is optimistic about its strategic focus on driving consistent margins and cash flows moving forward.SelectQuote Financial Statement Overview
Summary
SelectQuote demonstrates solid revenue growth and effective cash management. However, profitability remains a concern with ongoing net losses. The balance sheet indicates moderate financial stability with low leverage, but negative ROE underscores profitability challenges.Income Statement
The TTM (Trailing-Twelve-Months) data shows a gross profit margin of 51.8% and a net profit margin of -0.1%, indicating strong gross profit but negative net income. Revenue growth from the previous year is 12.6%, indicating moderate sales growth. EBIT margin is at 5.3% and EBITDA margin at 5.8%, suggesting operating profitability but limited by high expenses. Despite revenue growth, the net profitability remains a challenge due to high operational costs.65
Positive
Balance Sheet
The debt-to-equity ratio stands at 0.17, reflecting manageable leverage. Return on equity (ROE) is negative due to a net loss, impacting overall investor returns. The equity ratio is 27.0%, indicating a reasonable level of equity financing. Overall, the balance sheet displays moderate financial stability with a positive equity position but is affected by negative earnings.58
Neutral
Cash Flow
The free cash flow growth rate is substantial at 1,066.1%, driven by improved cash flow management. The operating cash flow to net income ratio is -21.9, indicating strong cash generation compared to net losses. The free cash flow to net income ratio is -19.9, showing positive free cash flow despite net losses. This indicates effective cash management practices offsetting net income challenges.72
Positive
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.49B | 1.32B | 1.00B | 764.04M | 937.82M | 531.51M | Gross Profit |
| 771.50M | 597.97M | 475.36M | 297.24M | 667.10M | 364.12M | EBIT |
| 79.63M | 64.55M | 11.58M | -301.41M | 200.07M | 132.33M | EBITDA |
| 87.02M | 89.48M | 29.91M | -320.65M | 204.26M | 139.92M | Net Income Common Stockholders |
| -2.09M | -34.13M | -58.54M | -297.50M | 124.86M | 79.48M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 84.80M | 42.69M | 83.16M | 141.00M | 286.45M | 321.06M | Total Assets |
| 1.30B | 1.19B | 1.22B | 1.29B | 1.43B | 1.07B | Total Debt |
| 60.02M | 713.92M | 731.58M | 744.80M | 502.72M | 311.81M | Net Debt |
| -24.77M | 671.23M | 648.42M | 603.80M | 216.27M | -9.25M | Total Liabilities |
| 738.01M | 877.11M | 872.28M | 898.95M | 758.98M | 528.10M | Stockholders Equity |
| 350.21M | 316.80M | 346.97M | 391.11M | 674.89M | 545.69M |
| Cash Flow | Free Cash Flow | ||||
| 41.63M | 3.57M | -28.50M | -372.96M | -138.43M | -77.33M | Operating Cash Flow |
| 45.81M | 15.24M | -19.38M | -338.31M | -115.44M | -61.78M | Investing Cash Flow |
| -14.12M | -14.85M | -9.13M | -42.58M | -64.02M | -51.37M | Financing Cash Flow |
| 16.73M | -40.86M | -29.34M | 235.43M | 97.04M | 481.45M |
SelectQuote Technical Analysis
Negative
2.16
Price Trends
2.66
Negative
3.46
Negative
3.13
Negative
Market Momentum
-0.13
Negative
38.61
Neutral
46.74
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SLQT, the sentiment is Negative. The current price of 2.16 is below the 20-day moving average (MA) of 2.21, below the 50-day MA of 2.66, and below the 200-day MA of 3.13, indicating a bearish trend. The MACD of -0.13 indicates Negative momentum. The RSI at 38.61 is Neutral, neither overbought nor oversold. The STOCH value of 46.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SLQT.
SelectQuote Risk Analysis
SelectQuote disclosed 54 risk factors in its most recent earnings report. SelectQuote reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
SelectQuote Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $677.03M | 9.37 | 13.11% | 3.87% | 5.29% | 1200.44% | |
72 Outperform | $838.68M | 10.90 | 8.93% | 3.03% | 7.16% | 12.20% | |
68 Neutral | $813.98M | 9.38 | 20.78% | ― | -1.46% | 25.24% | |
64 Neutral | $12.87B | 9.76 | 7.85% | 78.04% | 12.07% | -7.94% | |
58 Neutral | $373.08M | ― | 0.82% | ― | 20.41% | 93.09% | |
54 Neutral | $478.47M | ― | -46.84% | ― | 51.96% | 60.33% | |
48 Neutral | $442.08M | ― | -29.48% | ― | 3.76% | 16.19% |
* Financial Sector Average
Performance Comparison
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SelectQuote Corporate Events
Executive/Board ChangesPrivate Placements and FinancingDividends
SelectQuote Secures $350 Million Investment from NL Monarch
Positive
Feb 28, 2025
On February 28, 2025, SelectQuote, Inc. completed the sale of 350,000 shares of Senior Non-Convertible Preferred Stock and 30,833,333 warrants to purchase common stock to NL Monarch Holdings LLC and NL Monarch Holdings II LLC, marking a significant $350 million investment. This transaction is expected to impact SelectQuote’s financial structure and operations, with implications for stakeholders, including changes in board composition and potential adjustments in dividend rates based on company liquidity and financial performance.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.