Is Lemonade Stock a Buy After Investment Firm X-Square Capital Doubled Its Stake?
Key Points
Investment advisor X-Square Capital added 142,628 shares of Lemonade, amounting to an $8.32 million increase in position value.
The trade represented a 2.17% change in the fund’s reportable assets under management.
Post-trade, X-Square Capital's Lemonade stake totaled 213,199 shares valued at $11.41 million.
Lemonade now represents 3.56% of fund AUM, making it the fund’s 2nd-largest holding.
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What happened
According to a Securities and Exchange Commission (SEC) filing dated November 10, 2025, investment advisor X-Square Capital, LLC purchased 142,628 additional shares of Lemonade (NYSE:LMND) during the third quarter.
The firm’s stake increased to 213,199 shares, worth $11.41 million as of September 30, 2025. The position now accounts for 3.56% of X-Square’s $320.15 million in reportable U.S. equity assets.
What else to know
X-Square Capital added to its Lemonade position, which now makes up 3.56% of its 13F assets.
Top holdings after the filing:
- HIMS: $24.25 million (7.6% of AUM)
- LMND: $11.41 million (3.6% of AUM)
- ASTS: $11.20 million (3.5% of AUM)
- SPY: $11.14 million (3.5% of AUM)
- AMD: $10.07 million (3.1% of AUM)
As of November 7, 2025, shares were priced at $75.02, up 130.34% over the past year, outperforming the S&P 500 by 152 percentage points.
Company Overview
| Metric | Value |
|---|---|
| Revenue (TTM) | $600.70 million |
| Net Income (TTM) | ($204.00 million) |
| Price (as of market close 11/07/25) | $75.02 |
| One-Year Price Change | 130.34% |
Company Snapshot
- Lemonade, Inc. offers renters, homeowners, pet, car, life, and landlord insurance products, generating revenue primarily from insurance premiums and related services.
- The company operates a digital-first, direct-to-consumer business model leveraging artificial intelligence to underwrite, price, and service policies efficiently.
- Lemonade targets individuals and households in the United States and Europe seeking streamlined, technology-driven insurance solutions.
Lemonade, Inc. is a technology-driven insurance provider focused on property, casualty, and specialty lines across the U.S. and Europe. The company differentiates itself through a fully digital platform and AI-powered underwriting, enabling rapid customer onboarding and claims processing.
Lemonade's strategy emphasizes customer-centric design and operational efficiency to compete in the evolving insurance landscape.
Foolish take
X-Square Capital increasing its stake in Lemonade is noteworthy because the fund more than doubled its previous holding of 70,571 shares at the end of the second quarter. The buy rocketed Lemonade to the number two stock out of more than 160 holdings, suggesting X-Square Capital holds a bullish outlook towards the company.
The fund's big buy makes sense given Lemonade's third quarter performance. The insurance provider's customer count rose a strong 24% year over year. This resulted in outstanding Q3 revenue growth of 42% year over year to $194.5 million.
Consequently, Lemonade raised its 2025 full-year sales guidance. It now expects revenue to come in between $727 million to $732 million, which would be strong growth over 2024's $526.5 million.
However, the company is not profitable. It exited Q3 with a net loss of $37.5 million. Still, that's an improvement over the prior year's net loss of $67.7 million.
Lemonade looks like a promising investment, given its customer and revenue growth as well as its shrinking net loss. Shares are hovering near the 52-week high of $81.90 reached on Nov. 6, so the prudent approach is to wait for the stock to drop before deciding to buy.
Glossary
Assets Under Management (AUM): The total market value of investments managed on behalf of clients by a fund or firm.
Reportable Assets: Investments that a fund is required to disclose in regulatory filings, such as those reported on SEC Form 13F.
Net Position Change: The difference in the value of a fund's holding in a security after buying or selling shares.
13F Assets: U.S. equity securities that institutional investment managers must report quarterly to the SEC on Form 13F.
Direct-to-Consumer: A business model where products or services are sold directly to end customers, bypassing intermediaries.
Underwrite: The process of evaluating and assuming risk in exchange for a premium, commonly used in insurance and securities issuance.
Quarter: A three-month period used by companies for financial reporting and performance measurement.
TTM: The 12-month period ending with the most recent quarterly report.
Outperforming: Achieving a better return or performance compared to a benchmark or index.
Stake: The amount of ownership or shares held in a company by an investor or institution.
Filing: An official document submitted to a regulatory authority, such as the SEC, often disclosing financial or ownership information.
AI-powered Underwriting: Using artificial intelligence to assess risk and determine insurance policy terms and pricing.
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Robert Izquierdo has positions in Advanced Micro Devices. The Motley Fool has positions in and recommends Advanced Micro Devices, Hims & Hers Health, and Lemonade. The Motley Fool has a disclosure policy.
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