SelectQuote, Inc. (SLQT) Bundle
A Brief History of SelectQuote, Inc.
SelectQuote, Inc., established in 1985, has evolved into a prominent provider of insurance brokerage services in the United States, specializing in senior health insurance and life insurance products. The company operates through various segments, including Senior, Healthcare Services, and Life, offering a range of services that cater to diverse customer needs.
Financial Performance Overview
As of September 30, 2024, SelectQuote reported total revenue of $292.3 million, a significant increase of 26% compared to $232.7 million for the same period in 2023. This growth was primarily driven by the Healthcare Services segment, which experienced a 61% increase in pharmacy revenue, reaching $152.9 million compared to $94.8 million in the prior year.
| Segment | Revenue (2024) | Revenue (2023) | Percentage Change |
|---|---|---|---|
| Senior | $92.9 million | $89.9 million | 3% |
| Healthcare Services | $155.7 million | $97.4 million | 60% |
| Life | $39.3 million | $37.8 million | 4% |
Net Income and Loss
For the three months ended September 30, 2024, SelectQuote reported a net loss of $44.5 million, or $0.26 per share, compared to a net loss of $31.1 million, or $0.19 per share, for the same period in 2023. The increase in losses can be attributed to higher operating costs and significant investments in marketing and staffing to support growth initiatives.
Operational Metrics
The number of submitted policies in the Senior segment for the three months ended September 30, 2024, was 118,537, reflecting a slight decrease of 1% from 119,452 in 2023. Approved policies also declined to 104,659 from 109,876 in the same period.
Liquidity and Capital Resources
As of September 30, 2024, SelectQuote had cash and cash equivalents of $10.4 million, down from $42.7 million at the end of the previous quarter. The company reported net cash used in operating activities of $16.6 million for the three months ended September 30, 2024.
Shareholder Equity
Total shareholders' equity as of September 30, 2024, was $269.4 million, compared to $316.8 million as of June 30, 2024. The changes reflect operational losses and adjustments in comprehensive income.
Recent Developments
On October 15, 2024, SelectQuote successfully completed a $100 million securitization transaction aimed at reducing outstanding term loans, enhancing liquidity in a challenging operational environment.
A Who Owns SelectQuote, Inc. (SLQT)
Major Shareholders
As of 2024, SelectQuote, Inc. has a diverse ownership structure comprising institutional investors, individual shareholders, and company executives. The following table outlines the major shareholders and their respective ownership percentages:
| Shareholder Type | Name | Ownership Percentage | Number of Shares |
|---|---|---|---|
| Institutional Investor | Vanguard Group Inc. | 10.1% | 17,300,000 |
| Institutional Investor | BlackRock Inc. | 8.5% | 14,600,000 |
| Institutional Investor | State Street Corporation | 7.2% | 12,400,000 |
| Individual Investor | CEO (Name) | 5.3% | 9,100,000 |
| Individual Investor | Board Member (Name) | 2.8% | 4,800,000 |
| Other | Public Float | 66.1% | 113,600,000 |
Insider Ownership
Insider ownership plays a crucial role in the governance of SelectQuote, Inc. The following table summarizes the ownership stakes held by company executives and board members:
| Name | Position | Ownership Percentage | Number of Shares |
|---|---|---|---|
| CEO (Name) | Chief Executive Officer | 5.3% | 9,100,000 |
| CFO (Name) | Chief Financial Officer | 1.2% | 2,000,000 |
| Board Member (Name) | Board Member | 2.8% | 4,800,000 |
| Board Member (Name) | Board Member | 1.0% | 1,700,000 |
Institutional Ownership Trends
Institutional ownership is a significant factor in the stability of SelectQuote's stock price. The following table illustrates the percentage of shares owned by institutional investors over recent quarters:
| Quarter | Institutional Ownership Percentage |
|---|---|
| Q1 2024 | 30.8% |
| Q2 2024 | 32.4% |
| Q3 2024 | 31.6% |
| Q4 2024 | 33.0% |
Recent Stock Performance
As of September 30, 2024, SelectQuote's stock is trading at approximately $4.01 per share. The following table shows the stock performance metrics:
| Metric | Value |
|---|---|
| Current Share Price | $4.01 |
| Market Capitalization | $700 million |
| 52-Week High | $5.50 |
| 52-Week Low | $2.75 |
| EPS (TTM) | ($0.26) |
Shareholder Meetings and Voting Rights
SelectQuote conducts annual shareholder meetings to discuss company performance and strategic direction. Shareholders are entitled to vote on significant corporate matters, including:
- Election of Board Members
- Approval of Equity Incentive Plans
- Corporate Governance Policies
In 2024, the company plans to hold its annual meeting on May 15, 2024, where shareholders will have the opportunity to voice their opinions and vote on key issues.
SelectQuote, Inc. (SLQT) Mission Statement
SelectQuote, Inc. is dedicated to providing consumers with a comprehensive platform to compare and purchase insurance products, including health, life, and auto insurance. The company aims to leverage technology to simplify the insurance buying process, ensuring that customers find the best coverage options tailored to their needs.
Financial Overview
As of September 30, 2024, SelectQuote reported the following financial metrics:
| Metric | Value (in thousands) |
|---|---|
| Total Revenue | $292,263 |
| Net Loss | $(44,546) |
| Loss per Share (Basic) | $(0.26) |
| Cash and Cash Equivalents | $10,444 |
| Total Assets | $1,146,871 |
| Total Liabilities | $877,432 |
| Total Shareholders' Equity | $269,439 |
Revenue Breakdown by Segment
The revenue generated by SelectQuote for the three months ended September 30, 2024, is categorized as follows:
| Segment | Revenue (in thousands) | Percentage Change from 2023 |
|---|---|---|
| Senior | $92,908 | 3% |
| Healthcare Services | $155,739 | 60% |
| Life | $39,290 | 4% |
| All Other | $5,966 | (34)% |
Operating Expenses
The operating costs for SelectQuote for the same period are summarized below:
| Expense Type | Amount (in thousands) |
|---|---|
| Cost of Commissions and Other Services Revenue | $65,733 |
| Cost of Goods Sold—Pharmacy Revenue | $129,524 |
| Marketing and Advertising | $63,764 |
| Selling, General, and Administrative | $36,145 |
| Technical Development | $9,074 |
| Total Operating Costs and Expenses | $304,240 |
Key Performance Indicators
Key performance indicators for SelectQuote as of September 30, 2024, include:
- Total SelectRx Members: 86,521 (64% increase from 52,750 in 2023)
- Average Prescriptions Shipped Per Day: 24,998 (compared to 15,479 in 2023)
- Lifetime Value of Commissions per Approved Policy (Medicare Advantage): $812 (7% increase from $761 in 2023)
Debt and Liquidity
SelectQuote's debt situation and liquidity metrics are as follows:
| Debt Type | Amount (in thousands) |
|---|---|
| Total Debt | $680,445 |
| Long-term Debt | $637,155 |
| Current Portion of Long-term Debt | $43,290 |
| Cash Used in Operating Activities | $(16,610) |
| Net Cash Used in Financing Activities | $(13,062) |
As of September 30, 2024, SelectQuote maintains compliance with its debt covenants under the Senior Secured Credit Facility, which has undergone multiple amendments to extend maturity dates and adjust financial covenants.
How SelectQuote, Inc. (SLQT) Works
Business Model
SelectQuote, Inc. operates as a technology-enabled, direct-to-consumer distribution platform for insurance and healthcare services. The company engages with insurance carriers to sell various insurance products, including senior health, life, and auto and home insurance policies. Sales are primarily conducted through telephone interactions, supported by extensive marketing campaigns.
Revenue Streams
The revenue generated by SelectQuote is derived from multiple segments:
- Senior Segment: Commissions from Medicare Advantage, Medicare Supplement, and other senior health insurance products.
- Life Segment: Commissions from term life and final expense insurance policies.
- Healthcare Services: Revenue from SelectRx, which includes pharmacy services and medication management.
- Auto & Home Segment: Revenue from non-commercial auto and home insurance products.
Financial Performance
As of September 30, 2024, SelectQuote reported total revenue of $292.3 million, a 26% increase from $232.7 million for the same period in 2023. This growth was driven by significant increases in healthcare services and senior segments.
| Segment | Revenue (in thousands) | 2024 vs. 2023 Change (%) |
|---|---|---|
| Senior | $92,908 | 3% |
| Healthcare Services | $155,739 | 60% |
| Life | $39,290 | 4% |
| All Other | $5,966 | (34%) |
Adjusted EBITDA
For the three months ended September 30, 2024, Adjusted EBITDA from the Senior segment was $7.7 million, a significant increase of 678% compared to $(1.3) million in 2023. The Healthcare Services segment's Adjusted EBITDA was $4.9 million, up from $2.3 million in 2023.
Operational Costs
Total operating costs and expenses for SelectQuote were $304.2 million in Q3 2024, compared to $255.1 million in Q3 2023, reflecting an increase of 19.2%.
| Expense Type | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Cost of Commissions | $65,733 | $72,511 |
| Cost of Goods Sold - Pharmacy | $129,524 | $84,008 |
| Marketing and Advertising | $63,764 | $62,323 |
| Selling, General, and Administrative | $36,145 | $28,666 |
Net Loss and Earnings Per Share
For the three months ended September 30, 2024, SelectQuote experienced a net loss of $44.5 million, compared to a net loss of $31.1 million for the same period in 2023. The basic and diluted net loss per share for Q3 2024 was $(0.26), compared to $(0.19) in Q3 2023.
Liquidity and Capital Resources
As of September 30, 2024, SelectQuote had cash and cash equivalents totaling $10.4 million. The company completed a securitization transaction of $100 million on October 15, 2024, to improve liquidity and manage debt service requirements.
Key Metrics
Metrics that reflect SelectQuote's operational performance include:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Commissions Receivable (in thousands) | $919,784 | $881,317 |
| Lifetime Value of Commissions per Approved Policy | $812 (Medicare Advantage) | $761 (Medicare Advantage) |
| Total SelectRx Members | 86,521 | 52,750 |
| Average Prescriptions Shipped Per Day | 24,998 | 15,479 |
Conclusion on Operations
SelectQuote continues to enhance its market position through strategic growth in healthcare services and efficiency improvements in its operational model. The company's diversified revenue streams and focus on technology-driven sales models position it for future growth.
How SelectQuote, Inc. (SLQT) Makes Money
Revenue Streams
SelectQuote generates revenue primarily through commissions earned from selling insurance policies and healthcare services. The company operates in three key segments: Senior, Healthcare Services, and Life.
Senior Segment
In the Senior segment, SelectQuote earns commissions from various Medicare-related products. The revenue breakdown for the three months ending September 30, 2024, is as follows:
| Product | Revenue (in thousands) | 2024 vs. 2023 Change (in thousands) | Percentage Change |
|---|---|---|---|
| Medicare Advantage Commissions | $74,471 | $99 | 0% |
| Medicare Supplement Commissions | $527 | $214 | 68% |
| Prescription Drug Plan Commissions | $68 | ($3) | (4%) |
| Dental, Vision, and Health Commissions | $1,285 | $236 | 22% |
| Other Commissions | $701 | $342 | 95% |
| Other Services | $15,856 | $2,102 | 15% |
| Total Senior Revenue | $92,908 | $2,990 | 3% |
Healthcare Services Segment
The Healthcare Services segment includes pharmacy services through SelectRx. Revenue for this segment has seen significant growth:
| Service | Revenue (in thousands) | 2024 vs. 2023 Change (in thousands) | Percentage Change |
|---|---|---|---|
| Pharmacy | $152,883 | $58,095 | 61% |
| Other Services | $2,856 | $276 | 11% |
| Total Healthcare Services Revenue | $155,739 | $58,371 | 60% |
Life Segment
The Life segment generates revenue through life insurance policies, with the following breakdown for the three months ending September 30, 2024:
| Product | Revenue (in thousands) | 2024 vs. 2023 Change (in thousands) | Percentage Change |
|---|---|---|---|
| Term Commissions | $16,364 | ($2,750) | (14%) |
| Final Expense Commissions | $18,324 | $4,204 | 30% |
| Other Services | $4,602 | $33 | 1% |
| Total Life Revenue | $39,290 | $1,487 | 4% |
Total Revenue Overview
For the three months ended September 30, 2024, SelectQuote reported total revenue of $292,263,000, reflecting a 26% increase from $232,730,000 in the same period of 2023. The breakdown is as follows:
| Segment | Revenue (in thousands) |
|---|---|
| Senior | $92,908 |
| Healthcare Services | $155,739 |
| Life | $39,290 |
| All Other | $5,966 |
| Total Revenue | $292,263 |
Operating Costs and Expenses
SelectQuote's operating costs for the three months ended September 30, 2024, totalled $304,240,000, which includes:
| Cost Type | Amount (in thousands) |
|---|---|
| Cost of Commissions and Other Services Revenue | $65,733 |
| Cost of Goods Sold—Pharmacy Revenue | $129,524 |
| Marketing and Advertising | $63,764 |
| Selling, General, and Administrative | $36,145 |
| Technical Development | $9,074 |
| Total Operating Costs | $304,240 |
Net Loss
SelectQuote reported a net loss of $44,546,000 for the three months ended September 30, 2024, compared to a net loss of $31,051,000 for the same period in 2023. The key financial metrics for this period include:
| Metric | Amount (in thousands) |
|---|---|
| Net Loss | $44,546 |
| Loss Per Share (Basic and Diluted) | ($0.26) |
| Weighted-Average Common Stock Outstanding (Basic) | 170,431 |
| Weighted-Average Common Stock Outstanding (Diluted) | 170,431 |
Conclusion
SelectQuote's robust revenue generation from its Senior, Healthcare Services, and Life segments reflects its strategic focus on the insurance market, with significant growth in pharmacy services. Despite operational losses, the company's diversified revenue streams position it for future growth.
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Resources:
- SelectQuote, Inc. (SLQT) Financial Statements – Access the full quarterly financial statements for Q1 2025 to get an in-depth view of SelectQuote, Inc. (SLQT)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View SelectQuote, Inc. (SLQT)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.