tiprankstipranks
Trending News
More News >
SelectQuote (SLQT)
NYSE:SLQT

SelectQuote (SLQT) AI Stock Analysis

Compare
377 Followers

Top Page

SL

SelectQuote

(NYSE:SLQT)

Rating:62Neutral
Price Target:
$2.50
▼(-0.79%Downside)
SelectQuote's overall score of 62 reflects solid revenue growth and effective cash management, with challenges in profitability and valuation. The earnings call provided a positive outlook with strategic focus on improving profitability. However, technical indicators suggest mixed momentum, and recent corporate leadership changes add a layer of uncertainty.

SelectQuote (SLQT) vs. SPDR S&P 500 ETF (SPY)

SelectQuote Business Overview & Revenue Model

Company DescriptionSelectQuote, Inc. (SLQT) is a leading technology-enabled, direct-to-consumer distribution platform that provides insurance products and services. The company operates primarily in the United States, offering a wide range of insurance solutions including life, auto, home, and health insurance. SelectQuote uses a proprietary technology platform to connect consumers with a network of insurance carriers, enabling them to compare and purchase policies that best meet their needs.
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: -5.62%|
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
65
Positive
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.
Balance Sheet
58
Neutral
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.
Cash Flow
72
Positive
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.
BreakdownTTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income Statement
Total Revenue1.49B1.32B1.00B764.04M937.82M531.51M
Gross Profit771.50M597.97M475.36M297.24M667.10M364.12M
EBITDA87.02M89.48M29.91M-320.65M204.26M139.92M
Net Income-2.09M-34.13M-58.54M-297.50M124.86M79.48M
Balance Sheet
Total Assets1.30B1.19B1.22B1.29B1.43B1.07B
Cash, Cash Equivalents and Short-Term Investments84.80M42.69M83.16M141.00M286.45M321.06M
Total Debt60.02M713.92M731.58M744.80M502.72M311.81M
Total Liabilities738.01M877.11M872.28M898.95M758.98M528.10M
Stockholders Equity350.21M316.80M346.97M391.11M674.89M545.69M
Cash Flow
Free Cash Flow41.63M3.57M-28.50M-372.96M-138.43M-77.33M
Operating Cash Flow45.81M15.24M-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 Flow16.73M-40.86M-29.34M235.43M97.04M481.45M

SelectQuote Technical Analysis

Technical Analysis Sentiment
Positive
Last Price2.52
Price Trends
50DMA
2.40
Positive
100DMA
3.14
Negative
200DMA
3.05
Negative
Market Momentum
MACD
0.02
Negative
RSI
59.00
Neutral
STOCH
65.50
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SLQT, the sentiment is Positive. The current price of 2.52 is above the 20-day moving average (MA) of 2.31, above the 50-day MA of 2.40, and below the 200-day MA of 3.05, indicating a neutral trend. The MACD of 0.02 indicates Negative momentum. The RSI at 59.00 is Neutral, neither overbought nor oversold. The STOCH value of 65.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
69
Neutral
$924.45M12.018.93%2.69%7.16%12.20%
69
Neutral
$673.52M9.3113.11%3.84%5.29%1200.44%
69
Neutral
$919.65M10.5620.78%-1.46%25.24%
67
Neutral
$16.89B11.809.79%3.77%12.07%-8.35%
62
Neutral
$411.08M0.82%20.41%93.09%
61
Neutral
$517.72M-46.84%51.96%60.33%
LDLDI
48
Neutral
$428.88M-29.48%3.76%16.19%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SLQT
SelectQuote
2.52
-0.58
-18.71%
DGICA
Donegal Group
18.87
6.52
52.79%
TREE
Lendingtree
38.37
-3.14
-7.56%
UVSP
Univest Of Pennsylvania
32.29
10.54
48.46%
WRLD
World Acceptance
172.67
46.18
36.51%
LDI
loanDepot
1.39
-0.27
-16.27%

SelectQuote Corporate Events

Executive/Board Changes
SelectQuote Announces Passing of Vice Chairman Grant
Negative
Jul 2, 2025

On July 1, 2025, SelectQuote announced the passing of William T. Grant II, Vice Chairman and former President, who played a crucial role in the company’s evolution into a diversified insurance and healthcare services business. His leadership significantly impacted the company’s success and the lives of its associates. His sons, Bill and Bob Grant, will continue in their executive roles at SelectQuote.

The most recent analyst rating on (SLQT) stock is a Hold with a $2.75 price target. To see the full list of analyst forecasts on SelectQuote stock, see the SLQT Stock Forecast page.

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.Date of analysis: Jul 09, 2025