Root (NASDAQ:ROOT) Shares Gap Down on Analyst Downgrade

Root, Inc. (NASDAQ:ROOT)’s stock price gapped down before the market opened on Thursday after Keefe, Bruyette & Woods lowered their price target on the stock from $95.00 to $80.00. The stock had previously closed at $60.28, but opened at $47.00. Keefe, Bruyette & Woods currently has an outperform rating on the stock. Root shares last traded at $46.2450, with a volume of 174,810 shares traded.

Several other research firms have also recently weighed in on ROOT. UBS Group set a $50.00 target price on shares of Root and gave the company a “neutral” rating in a research note on Monday, May 11th. Zacks Research upgraded Root from a “strong sell” rating to a “hold” rating in a research report on Monday, June 8th. Weiss Ratings raised Root from a “hold (c-)” rating to a “hold (c)” rating in a report on Tuesday, July 28th. TD Cowen reissued a “hold” rating on shares of Root in a report on Wednesday, June 17th. Finally, Wells Fargo & Company boosted their price objective on Root from $58.00 to $61.00 and gave the company an “equal weight” rating in a research report on Thursday, July 9th. Two investment analysts have rated the stock with a Buy rating and five have issued a Hold rating to the company’s stock. According to data from MarketBeat.com, the stock presently has a consensus rating of “Hold” and an average price target of $82.25.

Institutional Inflows and Outflows

A number of institutional investors have recently modified their holdings of the company. CoreCap Advisors LLC bought a new position in shares of Root in the second quarter valued at approximately $42,000. Russell Investments Group Ltd. grew its position in Root by 511.7% during the 2nd quarter. Russell Investments Group Ltd. now owns 734 shares of the company’s stock worth $94,000 after acquiring an additional 614 shares during the last quarter. Advisory Services Network LLC bought a new stake in Root during the 3rd quarter worth approximately $144,000. Tower Research Capital LLC TRC increased its holdings in Root by 237.2% during the 2nd quarter. Tower Research Capital LLC TRC now owns 1,278 shares of the company’s stock valued at $164,000 after purchasing an additional 899 shares in the last quarter. Finally, Zurcher Kantonalbank Zurich Cantonalbank acquired a new stake in Root during the 3rd quarter valued at $194,000. Institutional investors own 59.82% of the company’s stock.

Root Trading Down 21.3%

The company has a 50-day simple moving average of $57.11 and a 200-day simple moving average of $55.37. The company has a debt-to-equity ratio of 0.61, a quick ratio of 1.07 and a current ratio of 1.07. The stock has a market cap of $750.83 million, a P/E ratio of 13.95 and a beta of 2.89.

Root (NASDAQ:ROOT) last announced its earnings results on Wednesday, May 6th. The company reported $2.09 EPS for the quarter, topping the consensus estimate of $0.84 by $1.25. The company had revenue of $393.50 million for the quarter, compared to analysts’ expectations of $398.16 million. Root had a return on equity of 19.97% and a net margin of 3.58%.The business’s revenue for the quarter was up 12.5% on a year-over-year basis. During the same quarter in the prior year, the business earned $1.07 earnings per share. On average, sell-side analysts forecast that Root, Inc. will post 3.28 EPS for the current fiscal year.

About Root

Root, trading on the Nasdaq under the ticker ROOT, is a Columbus, Ohio–based insurance company that leverages mobile technology and data analytics to offer personalized auto insurance policies. Founded in 2015 by Alex Timm and Dan Manges, Root set out to transform traditional underwriting by focusing on individual driving behavior rather than broad demographic factors.

The company’s core product is usage-based auto insurance, delivered through a smartphone app that monitors driving patterns such as speed, braking and phone usage behind the wheel.