Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at eHealth (NASDAQ:EHTH) and its peers.
Marketplaces have existed for centuries. Where once it was a main street in a small town or a mall in the suburbs, sellers benefitted from proximity to one another because they could draw customers by offering convenience and selection. Today, a myriad of online marketplaces fulfill that same role, aggregating large customer bases, which attracts commission-paying sellers, generating flywheel scale effects that feed back into further customer acquisition.
The 16 online marketplace stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 4.9% while next quarter’s revenue guidance was 5.1% above.
Inflation progressed towards the Fed's 2% goal recently, leading the Fed to reduce its policy rate by 50bps (half a percent or 0.5%) in September 2024. This is the first cut in four years. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be debating whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.
Thankfully, online marketplace stocks have been resilient with share prices up 6.5% on average since the latest earnings results.
eHealth (NASDAQ:EHTH)
Aiming to address a high-stakes and often confusing decision, eHealth (NASDAQ:EHTH) guides consumers through health insurance enrollment and related topics.eHealth reported revenues of $65.86 million, down 1.4% year on year. This print exceeded analysts’ expectations by 20.9%. Overall, it was a strong quarter for the company with full-year revenue guidance beating analysts’ expectations.
eHealth scored the biggest analyst estimates beat and highest full-year guidance raise of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 6.4% since reporting and currently trades at $4.39.
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Best Q2: EverQuote (NASDAQ:EVER)
Aiming to simplify a once complicated process, EverQuote (NASDAQ:EVER) is an online insurance marketplace where consumers can compare and purchase various types of insurance from different providersEverQuote reported revenues of $117.1 million, up 72.3% year on year, outperforming analysts’ expectations by 13.9%. The business had an incredible quarter with optimistic revenue guidance for the next quarter and exceptional revenue growth.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 15.8% since reporting. It currently trades at $20.20.
Weakest Q2: Teladoc (NYSE:TDOC)
Founded to help people in rural areas get online medical consultations, Teladoc Health (NYSE:TDOC) is a telemedicine platform that facilitates remote doctor’s visits.Teladoc reported revenues of $642.4 million, down 1.5% year on year, falling short of analysts’ expectations by 1.1%. It was a softer quarter as it posted slow revenue growth.
As expected, the stock is down 8.4% since the results and currently trades at $8.65.
LegalZoom (NASDAQ:LZ)
Founded by famous lawyer Robert Shapiro, LegalZoom (NASDAQ:LZ) offers online legal services and documentation assistance for individuals and businesses.LegalZoom reported revenues of $177.4 million, up 5% year on year. This number beat analysts’ expectations by 2.6%. Taking a step back, it was a weaker quarter as it produced slow revenue growth and a miss of analysts’ user estimates.
The company reported 1.61 million users, up 3.6% year on year. The stock is up 10.8% since reporting and currently trades at $6.58.
eBay (NASDAQ:EBAY)
Originally known as the first online auction site, eBay (NASDAQ:EBAY) is one of the world’s largest online marketplaces.eBay reported revenues of $2.57 billion, up 1.3% year on year. This print surpassed analysts’ expectations by 1.8%. Taking a step back, it was a weaker quarter as it logged slow revenue growth and underwhelming revenue guidance for the next quarter.
The stock is up 19.3% since reporting and currently trades at $66.28.
This content was originally published on Stock Story
