Root, Inc.
$52.37
-6.0%Root, Inc. provides insurance products and services in the United States. The company offers automobile, homeowners, and renters insurance products. The company operates a direct-to-consumer model and serves customers primarily through mobile applications, as well as through its website. Its direct distribution channels also cover digital, media, and referral channels, as well as distribution partners and agencies. The company was incorporated in 2015 and is headquartered in Columbus, Ohio.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
High confidenceValuation multiple is mid-range (P/E 21.0).
Valuation inputs: P/E 21.0, earnings yield +4.8%, momentum -6.0%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is soft (ROE +10.2%, ROIC +3.5%).
Profitability stack: net margin +2.7%, ROE +10.2%, ROIC +3.5%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceDownside profile is elevated and scenario stress-testing is essential.
Risk factors: liabilities/assets +74.2%, momentum -6.0%, net margin +2.7%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
Root, Inc. Market vs Earnings Trajectory
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Root, Inc. Fair Value Envelope
Root, Inc. Profit Bridge
Profitability Analysis
Gross Margin
Moderate margins typical of competitive industries. Monitor for pricing pressure or rising costs.
Operating Margin
Minimal operating profit suggests high operating costs or pricing challenges. Scalability is concerning.
Net Profit Margin
Minimal profitability after all expenses. Limited financial flexibility for reinvestment or shareholder returns.
Effective Tax Rate
Below-average tax rate suggests effective tax planning, favorable jurisdictions, or tax credits.
Profitability Insight
Room for improvement: Moderate profitability with opportunities to enhance margins through better cost management or pricing strategy.
Root, Inc. Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Excellent cash generation. The company converts earnings to cash at or above 100%, indicating high-quality earnings.
CapEx Intensity
Asset-light business model. Low capital requirements leave more cash available for shareholders and growth investments.
FCF Growth Trend
Flat FCF growth. Stable but not expanding—monitor for signs of business maturity or temporary headwinds.
Working Capital Impact
Working capital inflow boosted cash flow. Efficient management of receivables, inventory, and payables contributing positively.
Cash Flow Quality Insight
Asset-light with strong cash conversion: Low capital requirements combined with efficient cash generation creates significant shareholder value through dividends, buybacks, or strategic investments.
Root, Inc. Funding & Solvency Profile
Financial Health Analysis
Debt-to-Equity Ratio
High financial leverage. Heavy reliance on debt may indicate increased financial risk and potential solvency concerns.
Working Capital
Strong working capital position provides significant operational flexibility and financial cushion.
Asset Composition
Balanced asset mix between current and non-current assets, typical of many stable businesses.
Root, Inc. Street Expectations Map
Wall Street analysts project that ROOT stock may rise significantly over the coming 12 months. The consensus 1-year price target stands at 62.50, with estimates ranging from a low of 50.00 to a high of 75.00.
The consensus 1-year price target stands at 62.50, with estimates ranging from a low of 50.00 to a high of 75.00.
Analyst Consensus Analysis
Upside Potential
Strong upside potential. Consensus indicates attractive return opportunity with favorable risk-reward profile.
Analyst Agreement
Mixed analyst views. Wide target range suggests differing opinions on key value drivers, growth prospects, or risk factors.
Risk-Reward Profile
Favorable risk-reward. Potential upside significantly exceeds downside risk, offering asymmetric return profile attractive for risk-tolerant investors.
Analyst Conviction
Neutral sentiment. Fair value pricing with moderate agreement suggests wait-and-see approach or catalyst-driven opportunity.
Market Sentiment Insight
Asymmetric upside: Strong return potential with favorable risk-reward profile. The limited downside relative to upside makes this an attractive risk-adjusted opportunity for growth-oriented portfolios.
Root, Inc. Insider Positioning
During the last 12 months, insiders have sold $2.70M worth of ROOT shares, with no buying activity reported.
3 Months
0
0.00
21.0K
962.99K
-963K
-$963K
3-6 Months
0
0.00
19.9K
1.38M
-1.4M
-$1.38M
6-9 Months
0
0.00
3.4K
326.58K
-327K
-$327K
9-12 Months
0
0.00
406
35.68K
-36K
-$36K
Top Buyers
No buying activity
Top Sellers
Allison Jonathan
Officer: Chief Administrative Officer
$1.34M
Bonakdarpour Mahtiyar
Officer: President And Cto
$624K
Timm Alexander E.
Director, 10 Percent Owner, Officer: Chief Executive Officer
$562K
Forish Ryan
Officer: Chief Accounting Officer
$180K
Insider Activity Analysis
Net Insider Sentiment
Strong bearish signal with $2.70M net selling. Heavy insider selling may indicate concerns about valuation or near-term prospects.
Buy/Sell Ratio
Very poor ratio. Heavy selling with minimal buying suggests insiders may be concerned about valuation or outlook.
Recent Trend (3 Months)
Heavy recent selling activity. Recent insider sales notably exceed purchases—may warrant investigation into company developments.
Insider Participation
4 insider sellers vs. 0 buyers. Widespread selling across multiple insiders may signal concerns.
Insider Activity Insight
Multiple red flags: Heavy selling, numerous sellers, and continued recent selling create a concerning pattern. Investigate fundamental drivers and consider whether company guidance or industry conditions have deteriorated.
No Dividend Yield Data
ROOT has not reported any dividend yield values in the available annual periods.
root Dividend History
Learning Layer
Related Guides
Build conviction on ROOT by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.