SelectQuote (NYSE:SLQT) Posts Quarterly Earnings Results, Beats Expectations By $0.12 EPS

SelectQuote (NYSE:SLQT) posted its quarterly earnings data on Wednesday. The company reported ($0.21) earnings per share for the quarter, topping the consensus estimate of ($0.33) by $0.12, FiscalAI reports. SelectQuote had a net margin of 3.84% and a return on equity of 19.70%. The company had revenue of $280.01 million during the quarter, compared to analyst estimates of $277.91 million.

Here are the key takeaways from SelectQuote’s conference call:

• Adjusted EBITDA loss improved by more than $15 million year over year to $17 million, despite revenue falling 15% to $280 million. Management reiterated its target of at least $60 million in fiscal 2027 operating cash flow.
• SelectQuote is operating with a smaller Senior agent force and is prioritizing profitability over sales volume amid continued Medicare Advantage plan changes. The company has not changed its cautious outlook for policy volumes, though it said agent productivity and technology may help offset the headwind.
• Early AEP engagement is encouraging, and agents have contacted more than half of beneficiaries facing plan terminations; management aims to exceed last year’s 30% recapture rate. Executives emphasized that results are still early and the season remains dynamic.
• Healthcare Services adjusted EBITDA rose 56% to $11 million and EBITDA per SelectRx member increased more than 60%, even as segment revenue fell 16%, primarily due to the Inflation Reduction Act. Management expects the pharmacy management system and facility efficiencies to support further margin improvement, including a goal to double Healthcare Services margins in fiscal 2027.
• The company said it has removed more than $30 million in permanent annualized costs and is using AI to improve agent productivity and streamline enrollment. Management cited faster automated enrollments and expects these technology investments to support profitability and scalability.

SelectQuote Stock Up 21.0%

SLQT traded up $0.09 during trading hours on Wednesday, hitting $0.50. 5,090,436 shares of the company’s stock were exchanged, compared to its average volume of 1,545,860. The stock has a market cap of $88.91 million, a price-to-earnings ratio of -6.27 and a beta of 2.01. The stock’s 50-day moving average is $0.43 and its two-hundred day moving average is $0.78. The company has a quick ratio of 6.57, a current ratio of 6.57 and a debt-to-equity ratio of 0.99. SelectQuote has a 1-year low of $0.30 and a 1-year high of $2.17.

Wall Street Analysts Forecast Growth

SLQT has been the topic of several research reports. Weiss Ratings downgraded shares of SelectQuote from a “sell (d+)” rating to a “sell (d)” rating in a research report on Monday, August 17th. Wall Street Zen downgraded SelectQuote from a “hold” rating to a “sell” rating in a report on Saturday, August 29th. Finally, Zacks Research raised shares of SelectQuote from a “strong sell” rating to a “hold” rating in a research report on Monday, October 26th. One analyst has rated the stock with a Strong Buy rating, two have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, SelectQuote currently has a consensus rating of “Hold” and an average price target of $3.00.

About SelectQuote

SelectQuote, Inc (NYSE: SLQT) operates a technology-enabled insurance distribution platform that helps consumers compare and purchase insurance products from third-party carriers. The company combines digital tools, proprietary data and licensed agents to connect customers with coverage suited to their needs.

SelectQuote’s primary business is its Senior segment, which provides access to Medicare Advantage, Medicare Supplement and prescription drug plans. The company has also historically offered life insurance, as well as auto and home insurance, through its Life and Auto & Home businesses.