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EverQuote: Excellent Crisis Execution

May 05, 2020 3:58 PM ETEverQuote, Inc. (EVER)3 Comments
Gary Alexander profile picture
Gary Alexander


  • Shares of EverQuote rallied nearly 30% after reporting stellar Q1 results that have seemingly been barely dented by the coronavirus.
  • The company notes that reduced claims at EverQuote's auto insurers have led them to invest more in customer acquisition.
  • Though EverQuote's revenue per quote request fell this quarter, corresponding to the broad decline in digital ad pricing, its cost to deliver quote requests fell even more.
  • EverQuote also delivered positive operating cash flows in the first quarter, despite cash flow losses in the first quarter last year.

For EverQuote (NASDAQ:EVER), it's like the coronavirus never happened. The insurance technology company, which provides an online search engine for consumers to search and compare insurance quotes, has just released first-quarter results and skyrocketed nearly 30% in response, with shares rallying near new 52-week highs. Unlike many other small-cap technology companies and recent IPOs that have had to contend with sharply decelerating revenue growth, tight liquidity, and mass layoffs, EverQuote is now sitting firmly in a position of strength.

Data by YCharts

Since last quarter, EverQuote has outperformed the S&P 500 by more than thirty points. I wrote in February that astronomical growth rates are the main driver propelling EverQuote's stock higher - but now, we can also see that shrewd management has also led to stable demand and rising profit margins amid a difficult macroeconomic backdrop.

Beyond the near term, EverQuote believes that the coronavirus and shelter-in-place orders help to accelerate the process of insurance shopping becoming a purely digital activity. EverQuote is already one of the best-known online marketplaces for auto insurance, but it's now also extending its capabilities into other huge insurance verticals, including home and life. With a market cap of just over $1.3 billion, I'd say EverQuote is still on the early cusp of re-formatting the way we purchase insurance, and investors have a chance to get in on the ground floor.

Q1 download

Let's now look into EverQuote's first-quarter results in greater detail. Take a look at the company's earnings summary below:

Figure 1. EverQuote 1Q20 resultsSource: EverQuote Q1 earnings release

Revenues grew 56% y/y to $81.4 million, obliterating Wall Street's expectations of $77.5 million (+48% y/y) by a wide eight-point margin. One of the key pieces to note here is that EverQuote managed to continue shepherding traffic to its site - its overall quote request volume jumped 80% y/y. The company's traffic growth teams have

This article was written by

Gary Alexander profile picture
With combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today. He has been a regular contributor on Seeking Alpha since 2017. He has been quoted in many web publications and his articles are syndicated to company pages in popular trading apps like Robinhood.

Analyst’s Disclosure: I am/we are long EVER. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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