What Happened?
Shares of digital insurance provider Lemonade (NYSE: LMND) jumped 13.1% in the afternoon session after it launched a first-of-its-kind insurance product for Tesla vehicles using Full Self-Driving (FSD) technology, offering a roughly 50% reduction in per-mile rates.
The stock's rise was a continuation of gains from the previous trading session, when the company first announced its "Lemonade Autonomous Car" insurance. The new offering was the result of a partnership with Tesla, which gave Lemonade access to previously unavailable vehicle data. According to the company, this data indicated that Teslas driven with FSD were involved in far fewer accidents. By pricing insurance based on actual usage and the increased safety of autonomous driving, Lemonade aimed to offer a more fair and affordable product. The company planned to first make the new insurance available in Arizona, followed by Oregon.
Is now the time to buy Lemonade? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Lemonade’s shares are extremely volatile and have had 60 moves greater than 5% over the last year. But moves this big are rare even for Lemonade and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 10 days ago when the stock gained 8.3% on the news that Truist Securities initiated coverage on the company with a "Buy" rating and a $98 price target.
The new coverage from Truist highlighted Lemonade's digital-first approach as a structural advantage over traditional insurers. This positive view followed the company's strong third-quarter 2025 financial results, where it posted better-than-expected earnings and revenue. In response to the solid performance, Citizens also raised its price target on the stock to $80 from $60. The stock's climb, which marked a new 52-week high, reflected this renewed investor confidence, driven by favorable analyst ratings and solid financial performance.
Lemonade is up 27% since the beginning of the year, and at $96.50 per share, has set a new 52-week high. Investors who bought $1,000 worth of Lemonade’s shares 5 years ago would now be looking at an investment worth $628.69.
While Wall Street chases Nvidia at all-time highs, an under-the-radar semiconductor supplier is dominating a critical AI component these giants can’t build without. Click here to access our full research report, it’s free.
