Lemonade Just Soared After Earnings -- Could It Reach $100 per Share Within the Next Year?

Core Insights - Lemonade's stock surged approximately 25% following the release of its second-quarter results, which exceeded expectations in terms of revenue and earnings, and the company raised its guidance [1][2] - The company is demonstrating significant progress in profitability and underwriting, particularly with its new car insurance product gaining traction [1][6] Group 1: Financial Performance - In-force premium increased by 29% year-over-year to $1.08 billion, marking the seventh consecutive quarter of accelerating growth [4] - The number of customers reached nearly 2.7 million, a 24% increase compared to the previous year [4] - Lemonade reported a positive operating cash flow of $6 million, a turnaround from a $12 million loss a year ago, with gross profit more than doubling year-over-year [5] Group 2: Underwriting and Loss Ratios - The company has made significant improvements in underwriting, with the gross loss ratio trending downward over the past four quarters [8][9] - The trailing-12-month gross loss ratio has shown a consistent decline, from 88% in Q3 2023 to a projected 70% by Q2 2025 [10] Group 3: Future Growth Potential - The Lemonade Car product is showing promising growth, with in-force premium up 12% sequentially and a 13-percentage-point improvement in loss ratio year-over-year [6] - The European market has emerged as a high-potential growth area, with in-force premium roughly tripling year-over-year [6] - The stock, currently trading around $50, has the potential to reach $100 per share, implying a market cap of approximately $7.3 billion, contingent on continued growth and strong underwriting performance [11][12]