Is Lemonade (LMND) Stock Outpacing Its Finance Peers This Year?

For those looking to find strong Finance stocks, it is prudent to search for companies in the group that are outperforming their peers. Lemonade (LMND) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Finance sector should help us answer this question.

Lemonade is one of 866 companies in the Finance group. The Finance group currently sits at #3 within the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.

The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Lemonade is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for LMND's full-year earnings has moved 5.6% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

According to our latest data, LMND has moved about 40.2% on a year-to-date basis. Meanwhile, the Finance sector has returned an average of 14.4% on a year-to-date basis. As we can see, Lemonade is performing better than its sector in the calendar year.

Annaly Capital Management (NLY) is another Finance stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 15%.

For Annaly Capital Management, the consensus EPS estimate for the current year has increased 0.6% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Looking more specifically, Lemonade belongs to the Insurance - Multi line industry, which includes 43 individual stocks and currently sits at #81 in the Zacks Industry Rank. This group has gained an average of 6.9% so far this year, so LMND is performing better in this area.

In contrast, Annaly Capital Management falls under the REIT and Equity Trust industry. Currently, this industry has 33 stocks and is ranked #192. Since the beginning of the year, the industry has moved +3.4%.

Going forward, investors interested in Finance stocks should continue to pay close attention to Lemonade and Annaly Capital Management as they could maintain their solid performance.

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This article originally published on Zacks Investment Research (zacks.com).

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