Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 14 Apr, 26 | LMND | Buy | USD 59.97 | USD 63.0 | USD 66.0 | 1 day | Closed |
10.47%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
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, car, pet, 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.
Robust Revenue Expansion: Q4FY25 revenue rose to USD 228.1 million from Q4FY24 USD 148.8 million
Strong In Force Premium Growth: Q4FY25 IFP increased to USD 1,236.5 million from Q4FY24 USD 943.7 million
Increase in Operating Expenses: Q4FY25 operating expenses rose to USD 154.2 million from Q4FY24 USD 123.9 million
Decline in Annual Dollar Retention: Q4FY25 ADR declined to 85% from Q4FY24 86%
The company faces risks related to sustained profitability amid high growth investments, reliance on AI-driven underwriting accuracy, regulatory requirements, competitive pressures in the insurance industry, and potential volatility in claims and reinsurance availability
| Entry Price | Support* | Target 1** | Target 2** |
|---|---|---|---|
| 59.97 | 54.0 | 63.0 | 66.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
**Target prices may vary by ±0.5% depending on market volatility.
Strong Growth Momentum with Improving Profitability Dynamics: Lemonade, Inc. demonstrated a robust financial and operational performance during Q4 2025, marked by sustained growth across key metrics and continued progress toward profitability. The company reported In Force Premium (IFP) of USD 1.24 billion in Q4 2025, reflecting a 31% year-on-year increase, supported by strong customer acquisition and improved pricing strategies. Revenue grew significantly by 53% YoY to USD 228.1 million, driven by higher gross earned premiums and favorable reinsurance structures.
Customer Expansion and Monetization Efficiency: The company continued to scale its customer base, with total customers rising by 23% YoY to 2.98 million, indicating strong market penetration and demand for its digital insurance offerings. Additionally, premium per customer increased by 7% YoY to USD 414, highlighting improved monetization and cross-selling capabilities. This combination of customer growth and higher average premiums underscores the scalability of Lemonade’s platform.
Profitability Improvement and Margin Expansion: Lemonade reported a substantial improvement in profitability metrics, with gross profit rising 73% YoY to USD 110.6 million, supported by both revenue growth and an improved gross loss ratio. Gross profit margin expanded to 48% from 43% in the prior year period, reflecting enhanced underwriting performance and operational efficiencies. Adjusted EBITDA loss narrowed significantly to USD (4.6) million compared to USD (23.8) million in Q4 2024, indicating strong operating leverage.
Loss Reduction and Earnings Trajectory: Net loss improved materially to USD (21.7) million in Q4 2025 compared to USD (30.0) million in Q4 2024, representing a 28% YoY reduction. The decline in losses reflects better pricing discipline, improved claims management, and benefits from scale. The company’s net loss ratio also improved meaningfully, contributing to a stronger earnings trajectory and reinforcing management’s path toward profitability.
Cash Flow Strength and Liquidity Position: The company reported improved cash flow metrics, with adjusted free cash flow increasing to USD 36.7 million compared to USD 26.5 million in the prior year period. Cash flow from operations stood at USD 20.7 million for the quarter. Lemonade maintained a strong liquidity position, with total cash, cash equivalents, and investments of approximately USD 1.12 billion as of December 31, 2025, providing adequate financial flexibility for growth initiatives.
Operational Efficiency Driven by AI and Automation: Operational performance continued to benefit from Lemonade’s AI-driven model, enabling improved underwriting accuracy, claims efficiency, and cost management. The company achieved better operating leverage as growth outpaced expense increases, despite higher customer acquisition spend. Continued enhancements in pricing models and automation are expected to further improve unit economics and support long-term scalability.
Growth Outlook and Strategic Initiatives: Looking ahead, Lemonade expects continued strong growth, with projected IFP growth of approximately 32% for FY 2026 and a significant reduction in adjusted EBITDA losses. Strategic investments in AI-driven pricing, cross-selling platforms, and automated growth engines are anticipated to enhance customer lifetime value and acquisition efficiency. The company remains on track to achieve adjusted EBITDA profitability in the near term, reinforcing confidence in its long-term growth model.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given to Lemonade, Inc. (NYSE: LMND) at the current market price of USD 59.97, as on 14 April, 2026 at 7:04 am PDT.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Financial Services Industry: Insurance - Property & Casualty
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) |
|---|---|---|---|---|---|---|---|
| LMND Lemonade Inc |
1.56 2.72% | 58.84 | - | - | 2.98 | 1.62 | 2.45 |
| CB Chubb Ltd |
-4.56 1.39% | 323.40 | 12.85 | 12.20 | 2.16 | 1.74 | 2.48 |
| PGR Progressive Corp |
0.45 0.22% | 204.87 | 34.22 | 20.33 | 1.55 | 5.46 | 1.70 |
| ALL The Allstate Corporation |
-0.49 0.22% | 221.17 | 5.68 | 8.60 | 0.83 | 1.94 | 0.96 |
| TKOMF Tokio Marine Holdings Inc. |
- -% | 45.87 | 14.81 | 10.00 | 0.0069 | 1.59 | 0.0064 |
Data Powered by EOD Historical Data (“EODHD”).
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels as on April 14, 2026. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned has been achieved and is subject to the factors discussed above.
Note 4: StockNextt reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
Disclaimer :
This report has been issued by StockNextt which has an Ontario Business Identification Number 1000958347 and British Columbia registration Number FM1051529 is a trade name under Kalkine Canada Advisory Services Inc. having Business Number 761925130BC0001. Kalkine Canada Advisory Services Inc. and StockNextt are collectively referred to as “StockNextt”, “we”, “us”, and “our”. The website https://stocknextt.com and associated pages are published by StockNextt. The information in this report and on the StockNextt website has been prepared from a wide variety of sources, which StockNextt, to the best of its knowledge and belief, considers accurate. StcokNextt has made every effort to ensure the reliability of information contained in its reports, newsletters, and websites. All information represents our views at the date of publication and may change without notice. The information in this report does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products. Our reports contain general recommendations for investing in securities and other financial products. StockNextt does not offer financial advice based upon your personal financial situation or goals, and we shall not be held liable for any investment or trading losses you may incur by using the opinions expressed in our reports, publications, market updates, news alerts and corporate profiles. StockNextt does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation. StockNextt’s general advice does not in any way endorse or recommend individuals, investment products or services for your personal financial situation. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional authorised financial planner and adviser. You should be aware that the value of any investment and the income from it can go down as well as up and you may not get back the amount invested. Please also read our Terms and conditions for further information. Employees and/or associates of StockNextt and its related entities may hold an interest in the securities or other financial products covered in this report or on the StockNextt website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.
Copyright © 2026 Krish Capital Pty Ltd. All rights reserved. No part of this website, or its content, may be reproduced in any form without our prior consent.
Australia