Okay, Trupanion thinks it's undervalued. Analysts are tripping over themselves to say it's got "significant upside." Give me a break. Undervalued according to who, exactly? The same geniuses who told us WeWork was the future of office space?
Let's be real: the stock's down nearly 20% this year. And they’re trying to sell us on this "narrative fair value estimate" of $56.50 when it's trading around $38? That's not a gap; that's a chasm of wishful thinking. It's like saying my beat-up Honda Civic is secretly worth a Lamborghini because...reasons.
They're patting themselves on the back about "improved underwriting discipline" and "higher lifetime value pets." What the hell is a "higher lifetime value pet"? Are they only insuring purebreds now? Are mutts suddenly too risky? This whole thing stinks of some kind of weird, eugenicist pet insurance scheme. I bet they're charging extra for goldfish with short lifespans.
And this BMO Insurance partnership? Don't even get me started. So Trupanion is now in bed with BMO Bank...sorry, BMO Financial Group. So what? Another soulless corporation partnering with another soulless corporation. BMO Stadium? BMO Harris? Who gives a flying fig? It's all just branding and empty promises. I bet their BMO customer service is just as awful as everyone else's. Bet you need a BMO login just to find out how much they're screwing you.
But here's the kicker: the price-to-earnings ratio. 107.8x! The industry average is 13.2x. Are you kidding me? They're asking us to pay eight times more than the competition for…what? A slightly better chance that Fluffy won't need a $10,000 surgery? It's insane.
"Investors are paying a steep premium for potential growth," the article says. No, investors are gambling on potential growth. There’s a difference. It's like buying a lottery ticket and calling it an "investment opportunity."
Offcourse, they're trying to spin it like they're being responsible with their money, that this new $120 million credit facility is a sign of strength. But let's be honest, companies usually take out credit when they need it, not when they're swimming in cash. So why? Are they planning some massive marketing blitz? Maybe they’re planning on buying out the competition? Or maybe…just maybe…they're not as confident as they're letting on. Trupanion (TRUP): Assessing Valuation After Record Q3 Earnings, BMO Partnership, and $120M Credit Facility
Then again, maybe I'm the crazy one here. Maybe everyone else sees the genius of Trupanion, and I'm just too cynical to see the light. But I doubt it.
This whole thing feels like a house of cards built on hype and hope. The numbers don't lie, but they can be twisted. Trupanion might be a great company, but its stock price is detached from reality. And until that changes, I'm staying far, far away.
