EverQuote, Inc. EVER has been in investors' good books on the back of solid performance of automotive and other insurance verticals, solid revenue growth within health direct-to-consumer agency, impressive inorganic growth and growth in consumer quote requests.
The Zacks Consensus Estimate for EverQuote’s 2023 earnings indicates year-over-year growth of 12.95%.
Earnings Surprise History
EverQuote has a decent earnings surprise history. Its bottom line beat estimates in three of the last four quarters and missed in one, the average being 24.57%.
EverQuote currently carries a Zacks Rank #2 (Buy).
Revenues of EverQuote are likely to gain from the solid performance of automotive insurance providers. Revenues from automotive insurance providers accounted for 80% of the total revenues in the first half of 2022.
Non-auto insurance revenue growth is likely to gain from strong execution in the health insurance vertical and specifically from direct-to-consumer agency policy sales.
Growth in overall consumer quote requests should benefit EverQuote as it reflects the insurer’s success in generating consumer traffic and the potential to increase the share of insurance-shopping consumers.
Variable marketing margin (VMM) is likely to gain from strong revenue growth within the health direct-to-consumer agency during the annual health open enrollment period. This is expected to drive an improvement in VMM operating point for the business.
This multi-line insurer witnessed impressive inorganic growth. The insurer acquired PolicyFuel, LLC and its affiliated entities in August 2021 to support its property and casualty (P&C) carrier partners. The acquisition enabled EverQuote to expand the range of products it offers to carriers and expands the market of EVER’s direct-to-consumer offerings.
PolicyFuel's policy sales-as-a-service business model is expected to provide the insurer with revenue diversity during a challenging period for the auto insurance marketplace.
The multi-line insurer’s capital and liquidity position is strong, with over $41.3 million of cash and cash equivalents. EVER boasts a debt-free balance sheet with cash balance improving over the last three years. The insurer has $35 million available for borrowing under the revolving line of credit and $10 million available for borrowing under the term loan, each with Western Alliance Bank.
In the past year, the stock has lost 62.5% compared with the industry’s decline of 15.9%.
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Other Stocks to Consider
Some other top-ranked stocks from the multi-line insurance industry are CNO Financial Group, Inc. CNO, Radian Group Inc. RDN and Horace Mann Educators Corporation HMN. While CNO Financial and Radian sport a Zacks Rank #1 (Strong Buy), Horace Mann Educators carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The bottom line of CNO Financial surpassed earnings estimates in three of the last four quarters and missed in one, the average being 30.50%. In the past year, the insurer has lost 25.7%.
The Zacks Consensus Estimate for CNO Financial’s 2022 and 2023 earnings has moved 0.4% north each in the past seven days.
Radian Group’s earnings surpassed estimates in three of the last four quarters and missed in one, the average earnings surprise being 29.51%.
The Zacks Consensus Estimate for RDN’s 2023 earnings has moved 5.3% north in the past 60 days. In the past year, the insurer has lost 19.3%.
Horace Mann’s earnings surpassed estimates in three of the last four quarters and missed in one, the average beat being 26.32%. In the past year, HMN has lost 4.2%.
The Zacks Consensus Estimate for 2023 earnings has moved 0.8% north in the past seven days.
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