Dr J Rould
Full-Time Tech Investor, Quantum/Cybersecurity, Philosophy Background
EverQuote is an insurance lead-generation middleman in a cyclical business during unpredictable times, with a potential threat if LLMs like GPT start connecting people directly to the best quotes. The financials are better than expected: strong revenue growth, gross profit outpacing operating expenses and booming free cash flow, though growth slowed. Technically, support sits near $14 and resistance near $25. Despite the good financials, the long-term idea does not appeal. x.comÂ
Ongoing LLM pressure on lead generation and private-equity competition make Rollins look expensive. Guidance was cut for a second straight quarter, with implied fourth-quarter residential growth potentially negative. A price closer to $25 looks like an opportunity to scale back into a short. x.comÂ
Lemonade looks expensive once valued as what it is, an insurance company. Replying to @javierluraschi's post on the stock, any price above 1x revenue is expensive for an insurer. x.comÂ
Copart looks more like a cyclical bet on insurance volumes than a durable leader. Its strengths were just as true in 2010-2020, yet something changed, and without identifying what would restore its lead over IAA, the case relies on volumes recovering. Rising ADAS penetration makes the volume problem look secular. x.comÂ
Root looks expensive at 16x next year's earnings when insurers usually get 12x. Fair value is about $29.78-37.90, or 12x next year's expected $2.82 EPS give or take 12%, so the stock trades about 22% above the top of that range. The view rests on reported earnings and estimates only, with no fundamental work. x.comÂ
Ethos is getting bubbly, and at $40 it is time to exit. Its ceiling is also structurally lower than Lemonade's: Ethos underwrites with its app but never holds the policy, so it earns mostly upfront fees from partner insurers rather than monthly premiums on policies it carries. That keeps it out of the top four fintech names. x.com x.comÂ
Lemonade is one of the best buys in the market because its AI model lets it scale customers, products and revenue without scaling headcount. In-force premium grew 32% YoY, its tenth straight quarter of acceleration, and doubled over three years as headcount fell; revenue tripled while gross profit grew 10x. Up to 50% discounts for miles driven on Tesla FSD show an edge traditional insurers can't copy. It should be EBITDA profitable in Q4 2026, yet the stock fell 50% in four months. x.com x.comÂ
Lemonade looks good but not good enough after a lofty price and high expectations into earnings, so it needs to get cheaper before it is worth buying. In-force premium grew 32% and revenue 79% as it approaches positive cash flow by the end of 2026; the low $40s or $30s would be the level to buy more. x.com x.comÂ
UiPath may carry the highest business-model risk of any SaaS company because LLM agents with computer use compete directly with its robotic process automation. Rivals include Anthropic and OpenAI themselves. Its base is sticky for now, with 97% gross retention, regulated large-enterprise customers and long contracts, giving it time to sell AI tools. Still, it would be very surprising if gross retention stays in the high 90s, and the 2x EV/ARR multiple reflects the threat. x.comÂ
Goosehead Insurance offers better hunting elsewhere, despite its appeal in isolation. It targets low-level insurance markets with heavy competition, including self-service options such as Progressive, and its founders have already cashed out big. x.comÂ
Lemonade is overvalued because AI is not a material or unique value driver in insurance, since every insurer uses AI and keeps improving it. It should trade at an insurance valuation of about 1.5-2.5x book value, roughly $30. An insurance CEO also called the company a joke and way overvalued. x.com x.comÂ
