Technicals Say Root Inc. (ROOT) Is A Hold

Root Inc. (NASDAQ:ROOT) traded with an addition of $0.16 to $5.11 on Wednesday, an upside of 3.27 percent. An average of 5,870,584 shares of common stock have been traded in the last five days. There was a fall of -$0.33 in the past week. The last 20 days have seen an average of 9,418,221 shares traded, while the 50-day average volume stands at 8,877,673.

ROOT stock has decreased by -17.64% in the last month. The company shares reached their 1-month lowest point of $4.65 on 10/06/21. Shares of the company touched a low of $4.67 and a high of $29.48 in 52 weeks. In spite of this, the price is down -82.66% from the 52-week high.

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Insider Transactions

127 days have passed since Root Inc. (ROOT) last reported insider trading activity. Manges Daniel, who is Chief Technology Officer, most recently acquired $150,000 shares at $8.80 per share on Jun 01. In this transaction, the insider spent $1,320,000. Chief Technology Officer, Manges Daniel, disposed of 150,000 shares at a price of $8.97 on May 17. The insider now owns more than $1,345,500 worth of shares. Prior to that, Chief Technology Officer Manges Daniel went on to Sale 36,427 shares at $11.09 each on Mar 15. An amount of $403,975 was transacted.

Valuation Metrics

Root Inc. (ROOT) has a trailing price-to-earnings (P/E) ratio of 13.00 for the broader industry and 12.56 for the sector. This means investors are optimistic about the stock’s future prospects. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 4.93, the price-to-book (PB) ratio at 1.62.

Financial Health

Further, the company has a long term debt to equity ratio of 0.26 and a total debt to equity ratio of 0.26 for the quarter ending June 29.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Root Inc.’s return on assets was -33.70%. For the broader industry, ROE averaged 11.41 over the past year.

Earnings Surprise

The analyst consensus anticipated Root Inc.’s latest quarter earnings to come in at -$0.5 per share, but it turned out to be -$0.72, a -44.00% surprise. At the end of the quarter ending June 29, Root Inc.’s stock balance sheet showed total debt was $212.4 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Root Inc. (ROOT) price momentum. RSI 9-day as of the close on 05 October was 29.29%, suggesting the stock is oversold, with historical volatility in this time frame at 44.33%.

As of today, ROOT’s price is $5.03 -6.18% or -$0.33 from its 5-day moving average. ROOT is currently trading -21.17% lower than its 20-day SMA and -47.16% lower than its 100-day SMA. However, the stock’s current price level is -33.67% below the SMA50 and -64.88% below the SMA200.

The stochastic %K and %D were 12.38% and 16.18%, respectively, and the average true range (ATR) was 0.41. With the 14-day stochastic at 14.92% and the average true range at 0.45, the RSI (14) stands at 32.83%. The stock has reached -0.35 on the 9-day MACD Oscillator while the 14-day reading was at -0.60.

Analyst Ratings

Wolfe Research launched coverage on Root Inc. (NASDAQ: ROOT) in its analyst report released on August 17, 2021. The firm assigned the stock a a Peer perform rating.The consensus rating for Root Inc. (ROOT) among analysts is Hold. According to current brokerage recommendations, 0 brokerage firms advise that investors sell ROOT, while 10 suggest investors hold. There are 1 analyst who rate the stock as underweight. The stock is rated overweight by 0 analysts, while 2 others rate it as a “buy”.

What is ROOT’s price target for the next 12 months?

Analysts predict a range of price targets between $5.00 and $13.00, with a median target of $6.50. Taking a look at these predictions, the average price target given by analysts for Root Inc. (ROOT) stock is $7.33.


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