Lemonade, Inc. (NYSE:LMND) shares are trading higher on Monday after the company renewed its global reinsurance program, effective July 1. The revamped 12-month program reduces its quota-share cession while expanding catastrophe coverage.

Under the renewed quota share agreements, Lemonade expects to cede about 18% of premiums to reinsurers, down from 20% under the previous program, allowing the digital insurer to retain more of its growing gross profit.

The program also adds tail catastrophe protection, lets its Property Per Risk (PPR) coverage expire, and expands its European catastrophe excess of loss (XOL) coverage.

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High Short Interest Metrics

The stock’s upward movement comes amid elevated short interest. During the last reporting period, short interest in Lemonade rose from 10.25 million shares to 10.78 million shares. This short position represents 15.36% of the company’s publicly available float.

Based on the recent average daily trading volume of 1.63 million shares, short sellers would require 6.61 days to cover and close out their positions.

Upcoming Quarterly Earnings Financials

The market reaction precedes Lemonade’s upcoming second-quarter financial results. Lemonade is scheduled to report its earnings on August 4. Wall Street analysts currently estimate a loss per share of 57 cents and quarterly revenue of $290.87 million for the period. Lemonade has beaten EPS estimates in 8 consecutive quarters.

Critical Levels To Watch for LMND Stock

LMND is trading far above its major trend gauges—about 30% above the 20-day SMA, 34.2% above the 50-day SMA, and 20.7% above the 200-day SMA—showing an extended rally rather than a slow grind higher. The 20-day SMA is above the 50-day SMA (bullish near-term structure), but the 50-day SMA remains below the 200-day SMA after the death cross in April, a reminder that the longer-term trend only recently started repairing.

RSI is the cleanest momentum read right now, sitting at 78.83.

  • Key Resistance: $84 — a nearby round-number/pivot area where an extended rally can stall if buyers hesitate
  • Key Support: $76 — a nearby pivot zone that sits close to current price and can act as the first line in the sand on any pullback

LMND Stock Price Activity: Lemonade shares were up 9.70% at $70.96 at the time of publication on Monday, according to Benzinga Pro data.

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