Why Online Insurance Marketplace Provider EverQuote Shares Are Up Premarket Tuesday

EverQuote, Inc. EVER shares are trading higher after the company reported better-than-expected fourth-quarter FY23 results and issued strong guidance.

Revenue declined 37% Y/Y to $55.71 million, beating the consensus of $49.81 million.

The company witnessed a decrease of 33% in Automotive insurance vertical revenue to $45.0 million. Meanwhile, revenue from home and renters insurance vertical rose 48% Y/Y to $9.8 million.

Variable Marketing Margin (VMM) of $20.7 million accounted for 37% of revenue in the quarter vs. 33% prior year.

Adjusted EBITDA loss stood at $(0.9) million, vs. adjusted EBITDA of $0.1 million. The company reported an EPS loss of $(0.19), surpassing the estimate of $(0.32).

As of December 31, 2023, the company had cash and cash equivalents of $38.0 million.

Joseph Sanborn, CFO, said, “In 2024, we will continue to be very disciplined in managing expenses and driving incremental operating leverage in the business. We are on track to achieve our goal of restoring consistent positive quarterly cash flow from operations in the first half of this year, followed by a return to our pre-downturn Adjusted EBITDA margins in 2024.”

Outlook: For the first quarter of 2024, EverQuote expects revenue of $78.0 million – $82.0 million (vs. consensus: $65.13 million), Variable Marketing Margin of $26.0 million – $28.0 million, and adjusted EBITDA of $3.0 million – $5.0 million.

Price Action: EVER shares are up 19.6% to $20.50 premarket on the last check Tuesday.