Why Lemonade Stock Wilted by Almost 9% on Wednesday

Lemonade stock dropped nearly 9% after Morgan Stanley analyst Bob Huang downgraded the stock from overweight to equalweight, citing a need for new catalysts to justify the 50% price increase over recent weeks. While acknowledging the company's strong momentum and recent reinsurance program announcement, Huang set a $75 price target and expressed concerns about the company's ability to navigate a softening auto insurance market.