EverQuote (EVER) Down 4.1% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for EverQuote (EVER). Shares have lost about 4.1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is EverQuote due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
EverQuote Q4 Earnings Beat on Lower Operating Expense
EverQuote incurred a net loss of 26 cents per share in fourth-quarter 2022, narrower than the Zacks Consensus Estimate of a loss of 27 cents. The bottom line was also narrower than the year-ago quarter’s loss of 29 cents per share.
EverQuote witnessed lower revenues from the Automotive and Other insurance verticals offset by lower expenses. High cost of claim issues resulting from supply-chain challenges showed signs of stability this year as signaled by lower expenses. Moreover, the company is raising rates continuously, fueling top-line growth in the coming years.
Behind the Headlines
Total revenues of $88.3 million missed the Zacks Consensus Estimate by 2.09%. The top line declined 13.5% year over year, primarily attributable to a weak performance in the Automotive and Other insurance verticals.
Revenues in the Automotive insurance vertical were $67.2 million, down 4.6% year over year. Revenues in the Other insurance vertical totaled $21.1 million, which decreased 33.3% year over year.
Total costs and operating expenses decreased 12.2% to $96.9 million, mainly due to lower costs of revenues, sales and marketing and research and development.
EverQuote’s Variable Marketing margin decreased 11.6% year over year in the quarter under review to $29.1 million. Adjusted EBITDA was $0.1 million, which decreased 83.1% year over year.
Financial Update
EverQuote exited 2022 with cash and cash equivalents of $30.8 million, down 12.1% from 2021-end. Total assets were $156.5 million, up 9% year over year. Total stockholders' equity increased 26.3% to $107.4 million.
Cash used in operations was $4.9 million compared with $6.8 million in the year-ago quarter.
Full-Year Highlights
Net loss per share in 2022 came in at 77 cents per share, up from 67 cents at 2021-end.
Revenues for the year totaled $404.1 million, down from $418.5 million at 2021-end.
Variable Marketing Margin totaled $128.3 million, a decrease of 1% from 2021-end.
Adjusted EBITDA for 2022 saw a sharp decline of 59.4% to $5.9 million.
Q1 2023 Guidance
EverQuote estimates revenues in the range of $101-$105 million, variable marketing margin of $31.5-$33.5 million and adjusted EBITDA in the band of $2-$4 million.
2023 Full-Year Guidance
EverQuote expects revenues of $420-$435 million, an increase of 4% from 2022.
The company expects a variable marketing margin of $132-$140 million, an increase of 2.8% from 2022-end.
EverQuote expects an adjusted EBITDA from $7 to $13 million compared with the reported figure of $5.9 million at 2022-end.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
The consensus estimate has shifted 25.4% due to these changes.
VGM Scores
Currently, EverQuote has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, EverQuote has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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EverQuote, Inc. (EVER) : Free Stock Analysis Report
