EverQuote, Inc. EVER shares have rallied 51.2% year to date (YTD) compared with the industry's growth of 23.4%. The Finance sector and the Zacks S&P 500 composite have returned 23.4% and 28.1%, respectively, in the same time frame. With a market capitalization of $654 million, the average volume of shares traded in the last three months was 0.5 million.

EVER Outperforms Industry, Sector, S&P YTD

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This multi-line insurer delivered an earnings surprise in each of the last four quarters, the average beat being 149.58%.

EverQuote’s Growth Projection Encourages

The Zacks Consensus Estimate for EverQuote’s 2024 earnings per share indicates a year-over-year increase of 147.4%. The consensus estimate for revenues is pegged at $486.79 million, implying a year-over-year improvement of 69%. The consensus estimate for 2025 earnings per share and revenues indicates an increase of 10.7% and 18.8%, respectively, from the corresponding 2024 estimates. 

EVER also has an impressive Growth Score of A. This style score helps analyze the growth prospects of a company.

Optimistic Analyst Sentiment for EVER

Two of the six analysts covering the stock have raised estimates for 2024 and 2025 over the past 30 days. Thus, the Zacks Consensus Estimate for 2024 and 2025 moved 12.3% and 3.8% north, respectively, in the last 30 days, reflecting analyst optimism.

Factors Acting in Favor of EVER

EverQuote’s top line has been increasing over the years owing to the solid performance of automotive and other insurance marketplace verticals. It remains well-poised to gain from the normalization of auto insurance carrier demand, given auto carrier recovery. It also remains focused on rapidly expanding into new verticals. 

Increasing consumer traffic, higher quote request volume and innovating advertiser products and services will continue to drive revenues. EverQuote expects revenues between $131 million and $136 million in the fourth quarter of 2024. 

The variable marketing margin (VMM) is likely to gain from declining customer acquisition costs and a shift in the revenue mix to local agent networks with higher VMMs. EVER expects the dynamics of the auto insurance market to put pressure on VMM within the auto insurance vertical. Apart from the auto insurance vertical, the company expects VMM to benefit from strong revenue growth within the health direct-to-consumer agency during the annual health open enrollment period. This is expected to drive the VMM operating point for the business. EverQuote expects VMM in the fourth quarter of 2024 to be between $38 million and $40 million, indicating 89% year-over-year growth at the midpoint. 

EVER boasts a debt-free balance sheet with cash balance improving over the last three years. The company aims to meet any future debt service obligations with the existing cash and cash equivalents and cash flows from operations, which are expected to be sufficient to fund operating expenses and capital expenditure requirements for at least the next 12 months, without considering liquidity available from the revolving line of credit.

In its efforts to strengthen its balance sheet and liquidity position, EverQuote modified its existing loan agreement with Western Alliance Bank. The company has a $25 million undrawn working capital line of credit with Western Alliance Bank, which is available until July 2025.

EVER Shares are Expensive

The stock is overvalued compared to its industry. It is currently trading at a price-to-book multiple of 5.56, higher than the industry average of 2.4. Shares of other multi-line insurers like Radian Group Inc. RDN, Assurant, Inc. AIZ and CNO Financial Group, Inc. CNO are also trading at a discount to the industry average.

Parting Thoughts

EverQuote’s higher quote request volume, solid performance of automotive and other insurance marketplace verticals and favorable growth estimates make it an attractive stock. EVER also has a VGM Score of A. Stocks with a favorable VGM Score are those with the most attractive value, best growth and most promising momentum compared with peers. Coupled with the positives, the time appears right for potential investors to bet on this Zacks Rank #2 (Buy) stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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