Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why Lemonade Stock Jumped 13% Today

By Anders Bylund - Dec 23, 2020 at 4:53PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Sometimes, it doesn't take much news to launch a big move.

What happened

Shares of Lemonade ( LMND -8.90% ) closed Wednesday's trading 12.9% higher, despite a complete lack of news from the company or earthshaking developments in the homeowner insurance market.

So what

Lemonade's stock continued a long-running pattern of rising prices and impressive share volumes, without any sudden spikes that might indicate a large investment from a single buyer. This is market momentum at its finest, driving the innovative insurer's stock prices to another all-time high.

A yellow arrow smashes through a brick wall on its way upward.

Image source: Getty Images.

Now what

Lemonade's stock has now gained 93.8% since its initial public offering (IPO) in July. That return is based on its closing price on the first day. The stock has more than quadrupled from the IPO's actual pricing of $29 per share.

Consumers are embracing Lemonade's artificial intelligence-based insurance sign-up and claim management tools, where you never have to deal with a human insurance agent. The company also passes on the cost savings of this all-digital business model to its customers in the form of lower insurance premiums.

Likewise, investors are applauding the fantastic business results that flow from Lemonade's disruptive idea. Sometimes, that's all the rocket fuel you need in order to deliver another big jump on a day with no significant news.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Lemonade, Inc. Stock Quote
Lemonade, Inc.
LMND
$45.05 (-8.90%) $-4.40

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
656%
 
S&P 500 Returns
144%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/02/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.