NEW YORK, May 6, 2025 /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of SelectQuote, Inc. ("SelectQuote" or the "Company") (NYSE: SLQT). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.The investigation concerns whether SelectQuote and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices. [Click here for information about joining the class action]On May 1, 2025, the U ...

ATLANTA, May 06, 2025 (GLOBE NEWSWIRE) -- Holzer & Holzer, LLC is investigating whether SelectQuote, Inc. (“SelectQuote” or the “Company”) (NYSE: SLQT) complied with federal securities laws. On May 1, 2025, the Department of Justice filed a False Claims Act complaint against SelectQuote, alleging that for six years Humana agreed to pay millions in kickbacks to the Company, conditioning the payments on “(1) SelectQuote delivering specific quantities of Medicare Advantage enrollments for Humana, (2) SelectQuo ...

Core Viewpoint - The U.S. Department of Justice has filed a False Claims Act complaint against SelectQuote and other health insurance companies, alleging illegal kickbacks related to Medicare Advantage plans, leading to a significant drop in SelectQuote's stock price [2]. Group 1: Legal Investigation - Bragar Eagel & Squire, P.C. is investigating potential claims against SelectQuote on behalf of its stockholders for possible violations of federal securities laws and unlawful business practices [1]. - The DOJ's complaint alleges that from 2016 to at least 2021, SelectQuote and other insurers paid hundreds of millions of dollars in illegal kickbacks to brokers for enrollments in Medicare Advantage plans [2]. Group 2: Stock Market Impact - Following the announcement of the DOJ lawsuit, SelectQuote's stock price decreased by $0.61 per share, representing a 19.24% decline, closing at $2.56 per share on May 1, 2025 [2].

Core Viewpoint - Pomerantz LLP is investigating claims of potential securities fraud and unlawful business practices involving SelectQuote, Inc. following a DOJ lawsuit alleging illegal kickbacks related to Medicare Advantage plans [1][3]. Group 1: Investigation and Legal Actions - Pomerantz LLP is representing investors of SelectQuote and is looking into claims of securities fraud or other unlawful practices by the company and its officers [1]. - The U.S. Department of Justice filed a False Claims Act complaint against SelectQuote and other insurers, alleging that from 2016 to 2021, they paid hundreds of millions of dollars in illegal kickbacks to brokers for enrollments in Medicare Advantage plans [3]. - Following the DOJ's announcement, SelectQuote's stock price dropped by $0.61, or 19.24%, closing at $2.56 per share on May 1, 2025 [3]. Group 2: Company Background - SelectQuote, Inc. operates in the health insurance sector and is involved in the marketing of Medicare Advantage plans [3]. - Pomerantz LLP is recognized for its expertise in corporate, securities, and antitrust class litigation, having a long history of fighting for victims of securities fraud and corporate misconduct [4].

Company Overview - SelectQuote, Inc. is an insurance broker that specializes in selling Medicare Advantage and other health insurance plans [3]. Legal Investigation - Robbins Geller Rudman & Dowd LLP is investigating potential violations of U.S. federal securities laws involving SelectQuote, focusing on whether the company and its executives made false or misleading statements or failed to disclose material information to investors [1]. - The U.S. Department of Justice filed a complaint against SelectQuote and other insurance broker organizations, alleging that they received illegal kickbacks from insurers in exchange for enrollments into Medicare Advantage plans [3]. Market Impact - Following the announcement of the DOJ complaint, SelectQuote's stock price experienced a significant decline, falling more than 19% [3].

Core Insights - SelectQuote, Inc. operates in the insurance and healthcare distribution industry but faces challenges with profitability and long-term growth potential [1] Company Overview - SelectQuote, Inc. is listed on NYSE under the ticker SLQT and is involved in the insurance and healthcare distribution sector [1] Financial Performance - The company is currently not very profitable, and the anticipated improvements are not expected to significantly alter its long-term investment appeal [1]

Group 1 - SelectQuote (SLQT) closed at $5.49, with a 23.1% gain over the past four weeks, and analysts set a mean price target of $7.33, indicating a 33.5% upside potential [1] - The average of three short-term price targets ranges from $7 to $8, with a standard deviation of $0.58, suggesting a 27.5% to 45.7% upside from the current price [2] - Analysts show strong agreement in revising earnings estimates higher, which correlates with potential stock price movements [4][9] Group 2 - The Zacks Consensus Estimate for the current year has increased by 65%, with no negative revisions, indicating positive earnings prospects for SLQT [10] - SLQT holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [11] - While consensus price targets may not be reliable for exact gains, they can guide the direction of price movement [12]

Financial Data and Key Metrics Changes - SelectQuote generated $481 million in revenue for Q2 2025, up 19% compared to the previous year [30] - Consolidated adjusted EBITDA totaled $88 million, reflecting a 30% increase year over year, with a company-wide margin of 18% [31] - The company raised its fiscal year 2025 guidance for revenue to a range of $1.5 billion to $1.575 billion, up from $1.425 billion to $1.525 billion [50] Business Line Data and Key Metrics Changes - The Senior segment reported revenue of $256 million, exceeding original plans, driven by strong performance from tenured agents [33] - Adjusted EBITDA for the Senior segment was $101 million, growing 28% year over year, with a margin of 39% [35] - SelectRx membership grew to 97,000, a 54% increase year over year, contributing to revenue of $183 million, up 64% [43][44] Market Data and Key Metrics Changes - The Medicare Advantage annual enrollment period (AEP) saw a 6% termination rate of plans, significantly higher than the typical rate of less than 1% [37] - SelectQuote recaptured over 30% of terminated policies, demonstrating the effectiveness of its agent-led model [38] - The lifetime value of Medicare Advantage policies decreased by 3% year over year to $907, primarily due to carrier mix [42] Company Strategy and Development Direction - The company is focused on optimizing its capital structure, including a $350 million preferred equity offering to improve operational flexibility and reduce debt [13][24] - SelectQuote aims to leverage its competitive advantage in the $5 trillion American health care market, particularly through its Medicare platform and health care services [25][26] - The company is exploring additional strategic alternatives to strengthen its balance sheet and enhance growth opportunities [23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate a unique AEP season and highlighted the importance of its agent-led model for seniors [18][20] - The outlook for the regulatory environment is more favorable, with expectations of growth within the Medicare Advantage market [89][90] - Management emphasized the importance of continued investment in technology and marketing to enhance agent productivity and customer engagement [96][100] Other Important Information - The company reported a revenue to customer acquisition cost (CAC) ratio of over 5x, indicating strong operational efficiency [28] - SelectQuote's strategic investments are expected to decrease ongoing capital costs by more than 150 basis points and reduce annual cash interest obligations by approximately $30 million [24] Q&A Session Summary Question: Guidance and OEP Insights - Management acknowledged the conservative nature of the new midpoint guidance and discussed ongoing investments in health care services [54][56] Question: SelectRx Market Opportunity - Management highlighted the synergies between SelectRx and the senior segment, noting strong market penetration and customer engagement [60][62] Question: Use of Proceeds from Preferred Equity Offering - The majority of proceeds will be used to pay down debt, reducing interest expenses and providing operational flexibility [73][75] Question: Regulatory Environment Outlook - Management expressed optimism about the new regulatory regime, indicating a more favorable outlook for Medicare Advantage [86][90] Question: Agent Force Strategy - Management confirmed that the strong performance of tenured agents does not change their strategy regarding agent count and productivity [94][96] Question: Adoption of Direct-to-Home Pharmacy - Management noted an increase in adoption of home delivery pharmacy services among seniors, driven by improved customer experience and regulatory changes [102][106]

分组1 - SelectQuote reported quarterly earnings of $0.30 per share, exceeding the Zacks Consensus Estimate of $0.09 per share, and compared to earnings of $0.11 per share a year ago, representing an earnings surprise of 233.33% [1] - The company posted revenues of $481.07 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 14.27%, and compared to year-ago revenues of $405.44 million [2] - SelectQuote shares have increased approximately 17.7% since the beginning of the year, outperforming the S&P 500's gain of 2.5% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $0.06 on $398 million in revenues, and for the current fiscal year, it is -$0.20 on $1.44 billion in revenues [7] - The Zacks Industry Rank for Insurance - Multi line is currently in the top 36% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Policy Submissions and Approvals - Total submitted policies for all products increased by 5% for the three months ended December 31, 2024, compared to the same period in 2023, driven by a 24% increase in overall close rates [147]. - Total approved policies for all products increased by 5% for the three months ended December 31, 2024, compared to the same period in 2023, correlating with the increase in submitted policies [152]. - Medicare Advantage plans accounted for 93% of approved Senior policies for the three months ended December 31, 2024 [139]. - Term life policies accounted for 44% of new premium within the Life segment for the three months ended December 31, 2024 [141]. Financial Performance - Total revenue for the three months ended December 31, 2024, was $481,069,000, a 19% increase from $405,438,000 in 2023, with pharmacy revenue rising by 65% to $180,000,000 [168]. - Operating income for the three months ended December 31, 2024, was $70,940,000, representing a 28% increase from $55,294,000 in 2023 [164]. - Net income for the three months ended December 31, 2024, was $53,236,000, compared to $19,392,000 in 2023, reflecting a significant improvement in profitability [164]. - Total consolidated revenue for the three months ended December 31, 2024, was $481.1 million, with external revenue from the Senior segment at $253.8 million [196]. - Revenue from the Senior segment for the three months ended December 31, 2024, was $255.6 million, a 3% increase compared to $247.5 million for the same period in 2023 [203][204]. - Revenue from Healthcare Services for the three months ended December 31, 2024, was $183.4 million, a 64% increase compared to $111.7 million for the same period in 2023, primarily driven by a $71.2 million increase in SelectRx pharmacy revenue [205][206]. Expenses and Costs - Total operating costs and expenses for the three months ended December 31, 2024, were $410,129,000, which is 84% of total revenue [164]. - Cost of goods sold for pharmacy revenue increased by 66% to $156,201,000 for the three months ended December 31, 2024, primarily due to a $53.8 million increase in medication costs [174]. - Marketing and advertising expenses decreased by $19.4 million, or 17%, for the three months ended December 31, 2024, primarily due to a $16.3 million decrease in lead costs [178]. - Selling, general, and administrative expenses increased by $11.6 million, or 35%, for the three months ended December 31, 2024, primarily due to a $4.9 million increase in compensation costs [182]. - Technical development expenses increased by $2.0 million, or 25%, for the three months ended December 31, 2024, primarily due to a $1.6 million increase in compensation costs [184]. Member Growth and Market Expansion - The total number of SelectRx members increased by 54% as of December 31, 2024, compared to December 31, 2023, reflecting the company's growth strategy [159]. - The company continues to seek opportunities for market expansion through acquisitions and partnerships in healthcare services [138]. - The company completed a $4.0 million acquisition of a chronic care management platform to enhance its healthcare services [140]. Cash Flow and Debt - Net cash used in operating activities for the six months ended December 31, 2024, was $45.3 million, consisting of net income of $8.7 million and adjustments for non-cash items of $41.0 million [231]. - Net cash used in investing activities was $4.8 million for the six months ended December 31, 2024, primarily due to $4.1 million in software purchases [235]. - Net cash provided in financing activities was $21.1 million for the six months ended December 31, 2024, mainly from $99.1 million proceeds on notes issued [238]. - Total debt obligations as of December 31, 2024, were $711.9 million, compared to $683.3 million as of June 30, 2024 [223]. - The company completed a $100.0 million securitization transaction on October 15, 2024, to pay down a portion of its outstanding term loans [219]. Tax and Adjusted EBITDA - The effective tax rate for the three months ended December 31, 2024, was (34.6)%, compared to 37.2% for the same period in 2023 [188]. - Adjusted Segment EBITDA for the Senior segment was $100.5 million for the three months ended December 31, 2024 [196]. - Adjusted EBITDA from the Senior segment for the three months ended December 31, 2024, was $100.5 million, a 28% increase from $78.7 million for the same period in 2023 [210]. - Adjusted EBITDA from the Life segment for the three months ended December 31, 2024, was $7.4 million, a 62% increase compared to $4.6 million for the same period in 2023 [212].