Selectquote stock is teetering on the brink of a significant breakdown, with its current price of $1.45 hovering just above the critical 52-week low of $1.33. A breach of this support level could trigger additional selling pressure in what has already been a devastating period for shareholders. The equity has surrendered 50-60% of its value in recent trading, raising questions about its near-term viability.
Mixed Financial Picture Emerges
The company’s financial metrics present a contradictory narrative that has left investors divided. While Selectquote demonstrates respectable revenue growth, concerning cash flow trends have emerged:
- Quarterly revenue reached $328.81 million, representing growth of 12.51%
- Annual revenue stands at $1.56 billion
- Operating cash flow shows a deficit of -$16.68 million
- Free cash flow registers at -$19.49 million
- Enterprise value is calculated at $669.20 million
Despite trading at a P/E ratio of 11.79, some market analysts consider the stock overvalued relative to industry competitors. The price-to-sales ratio of 0.17 further complicates the valuation picture, leaving investors to determine whether this represents a genuine bargain or a potential value trap.
Technical Indicators Signal Trouble
From a technical perspective, the chart reveals a concerning pattern. Shares currently trade just cents above their absolute lows, a stark contrast to the 52-week high of $6.86. The stock’s beta coefficient of 1.16 indicates it experiences more pronounced price swings than the broader market, adding another layer of risk for volatility-averse investors.
Should investors sell immediately? Or is it worth buying Selectquote?
The immediate focus remains on whether the $1.33 support level will hold. A decisive break below this threshold could open the door to further declines, potentially accelerating the downward momentum.
Analyst Optimism Clashes With Market Reality
A striking divergence exists between analyst projections and actual market performance. The average price target of $3.88 suggests potential upside exceeding 160%, yet market sentiment continues to pressure the stock lower.
The credibility of this optimistic forecast faces scrutiny given several fundamental concerns. The Altman Z-Score of 1.69 indicates financial distress, while negative cash flow figures undermine confidence in the company’s growth narrative.
The coming trading sessions will prove decisive in determining whether Selectquote can defend its critical support level or if the downward trajectory will continue unabated.
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