The car insurance is a strong tailwind for the Company as it completed the development of the Lemonade Car insurance platform, team, and product. The ease of use and access is the appeal of this disruptive fintech taking on the age-old boring insurance space. While the Q1 2021 “Texas Freeze” posed an outlier catastrophe (CAT) event with claims.
However, that is in the rearview mirror with the reopening as business is running on all cylinders as more awareness of the service is growing. Shares have cooled off from hype levels in the high $100 range. The in-force premium (IFP) indicated 91% growth in Q2 2021.
Pet insurance is an especially strong area of growth as pet adoption surged during the pandemic and should continue to rise. Prudent investors seeking exposure in the insurance segment can watch for opportunistic pullbacks in shares of Lemonade.
On Aug. 4, 2021, Lemonade released its second-quarter fiscal 2021 results for the quarter ending June 2021. The Company reported earnings-per-share (EPS) loss of (-$0.90) missing consensus analyst estimates for a loss of (-$0.89) by $0.01. Revenues fell (-5.7%) year-over-year (YoY) to $28.20 million, beating consensus analyst estimates for $1.4 million. The Company IFP increased 91% YoY to $297 million with 1.2 million customers. The Company say its 7th consecutive quarter with growing premiums per customer up 29% to $246. The Lemonade Car (insurance) product has a waitlist of over 10,000 customers leading to the development of an end-to-end, digital-first car policy management system from scratch.
CEO Daniel Schreiber set the tone:
LMND Opportunistic Pullback Levels
Using the rifle charts on the weekly and daily time frames provides a near-term precision view of the price action playing field for LMND shares. The weekly rifle chart has a downtrend triggered on the market structure high (MSH) breakdown under $92.47 with a falling 5-period moving average at the $75.54 Fibonacci (fib) level. The weekly 15-period MA is flattening at $89.47. The weekly stochastic has a mini inverse pup heading towards the 20-band.
The weekly market structure low (MSL) buy triggers above $77.32. The daily rifle chart has an uptrend with a rising 5-period MA at $77.30 powered by the stochastic mini pup. The daily upper Bollinger Bands (BBs) sit at $87.57. The stochastic mini pup can provide a thrust towards the daily upper BBs if shares can bounce off the daily 5-period MA.
Prudent investors can watch for opportunistic pullbacks at the $75.54 fib, $72.60, $68.82 fib, $67.65 level, $64.11 fib, and the $59.39 fib. The upside trajectories range from the $92.47 weekly MSH trigger up towards the $121.85 fib level.