Friday, November 08, 2024
Patrick McCann, CFA, Research Analyst, Noble Capital Markets, Inc.
Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Q3 beat. The company reported Q3 revenue of $118.3 million and an adj. EBITDA loss of $12.1 million, better than our estimates of $104.0 million and a loss of $14.1 million, respectively. Notably, the company benefited from improved efficiency with declines in direct costs of policy submissions and strong agent productivity.
Prepared for AEP. In our view, the company is well positioned heading onto this year’s Annual Enrolment Period (AEP) with several technological enhancements that drive favorable customer experiences and agent productivity. Using AI based tools, such as Plan GPT, the company has reduced its average call time from 90 minutes to 67 minutes. We believe the company could make additional incremental efficiency enhancements in Q4 and beyond, which could lead to more volume and margin improvement.
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