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ROOT INC/OH -CLASS A (ROOT) Stock Fundamental Analysis

NASDAQ:ROOT - Nasdaq - US77664L2079 - Common Stock - Currency: USD

152.825  +1.09 (+0.72%)

Fundamental Rating

3

ROOT gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 143 industry peers in the Insurance industry. ROOT scores quite bad on profitability, while its financial health is fine. Not spectacular, but in line with the averages. While showing a medium growth rate, ROOT is valued expensive at the moment.


Dividend Valuation Growth Profitability Health

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3

1. Profitability

1.1 Basic Checks

ROOT had positive earnings in the past year.
ROOT had a positive operating cash flow in the past year.
In the past 5 years ROOT reported 4 times negative net income.
ROOT had negative operating cash flow in 4 of the past 5 years.
ROOT Yearly Net Income VS EBIT VS OCF VS FCFROOT Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2018 2019 2020 2021 2022 2023 2024 0 -200M -400M

1.2 Ratios

ROOT's Return On Assets of 2.95% is fine compared to the rest of the industry. ROOT outperforms 68.53% of its industry peers.
Looking at the Return On Equity, with a value of 13.71%, ROOT is in the better half of the industry, outperforming 68.53% of the companies in the same industry.
With an excellent Return On Invested Capital value of 5.29%, ROOT belongs to the best of the industry, outperforming 83.92% of the companies in the same industry.
Industry RankSector Rank
ROA 2.95%
ROE 13.71%
ROIC 5.29%
ROA(3y)-10.55%
ROA(5y)-18.35%
ROE(3y)-40.11%
ROE(5y)-47.17%
ROIC(3y)N/A
ROIC(5y)N/A
ROOT Yearly ROA, ROE, ROICROOT Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2018 2019 2020 2021 2022 2023 2024 0 -50 -100 -150

1.3 Margins

Looking at the Profit Margin, with a value of 3.67%, ROOT is doing worse than 69.93% of the companies in the same industry.
ROOT has a Operating Margin (8.06%) which is comparable to the rest of the industry.
Industry RankSector Rank
OM 8.06%
PM (TTM) 3.67%
GM N/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
ROOT Yearly Profit, Operating, Gross MarginsROOT Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2018 2019 2020 2021 2022 2023 2024 0 -50 -100 -150

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4

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ROOT is destroying value.
ROOT has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, ROOT has more shares outstanding
ROOT has a better debt/assets ratio than last year.
ROOT Yearly Shares OutstandingROOT Yearly Shares OutstandingYearly Shares Outstanding 2018 2019 2020 2021 2022 2023 2024 5M 10M 15M
ROOT Yearly Total Debt VS Total AssetsROOT Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B

2.2 Solvency

ROOT has an Altman-Z score of 0.64. This is a bad value and indicates that ROOT is not financially healthy and even has some risk of bankruptcy.
ROOT has a Altman-Z score of 0.64. This is in the better half of the industry: ROOT outperforms 74.83% of its industry peers.
ROOT has a debt to FCF ratio of 1.00. This is a very positive value and a sign of high solvency as it would only need 1.00 years to pay back of all of its debts.
ROOT has a better Debt to FCF ratio (1.00) than 65.73% of its industry peers.
ROOT has a Debt/Equity ratio of 0.58. This is a neutral value indicating ROOT is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.58, ROOT is not doing good in the industry: 74.83% of the companies in the same industry are doing better.
Although ROOT does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
Industry RankSector Rank
Debt/Equity 0.58
Debt/FCF 1
Altman-Z 0.64
ROIC/WACC0.55
WACC9.61%
ROOT Yearly LT Debt VS Equity VS FCFROOT Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2018 2019 2020 2021 2022 2023 2024 0 500M 1B

2.3 Liquidity

A Current Ratio of 0.37 indicates that ROOT may have some problems paying its short term obligations.
ROOT has a better Current ratio (0.37) than 72.73% of its industry peers.
ROOT has a Quick Ratio of 0.37. This is a bad value and indicates that ROOT is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.37, ROOT is in the better half of the industry, outperforming 72.73% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 0.37
Quick Ratio 0.37
ROOT Yearly Current Assets VS Current LiabilitesROOT Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2018 2019 2020 2021 2022 2023 2024 50M 100M

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5

3. Growth

3.1 Past

ROOT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 141.18%, which is quite impressive.
The Revenue has grown by 98.66% in the past year. This is a very strong growth!
The Revenue has been growing by 32.31% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)141.18%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%354.76%
Revenue 1Y (TTM)98.66%
Revenue growth 3Y50.46%
Revenue growth 5Y32.31%
Sales Q2Q%37.07%

3.2 Future

ROOT is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 25.01% yearly.
The Revenue is expected to decrease by -8.30% on average over the next years.
EPS Next Y-39.16%
EPS Next 2Y4.65%
EPS Next 3Y25.01%
EPS Next 5YN/A
Revenue Next Year24.01%
Revenue Next 2Y17.25%
Revenue Next 3Y16.46%
Revenue Next 5Y-8.3%

3.3 Evolution

When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
ROOT Yearly Revenue VS EstimatesROOT Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 500M 1B 1.5B
ROOT Yearly EPS VS EstimatesROOT Yearly EPS VS EstimatesYearly EPS VS Estimates 2020 2021 2022 2023 2024 2025 2026 2027 0 -20 -40 -60

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1

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 47.76, the valuation of ROOT can be described as expensive.
80.42% of the companies in the same industry are cheaper than ROOT, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 26.59, ROOT is valued quite expensively.
Based on the Price/Forward Earnings ratio of 81.61, the valuation of ROOT can be described as expensive.
81.82% of the companies in the same industry are cheaper than ROOT, based on the Price/Forward Earnings ratio.
ROOT's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 22.39.
Industry RankSector Rank
PE 47.76
Fwd PE 81.61
ROOT Price Earnings VS Forward Price EarningsROOT Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as ROOT.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ROOT is on the same level as its industry peers.
Industry RankSector Rank
P/FCF 11.95
EV/EBITDA 16.49
ROOT Per share dataROOT EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 20 40 60 80

4.3 Compensation for Growth

ROOT's earnings are expected to grow with 25.01% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y4.65%
EPS Next 3Y25.01%

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0

5. Dividend

5.1 Amount

ROOT does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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ROOT INC/OH -CLASS A

NASDAQ:ROOT (6/11/2025, 3:38:35 PM)

152.825

+1.09 (+0.72%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)05-07 2025-05-07/amc
Earnings (Next)08-05 2025-08-05/amc
Inst Owners68.53%
Inst Owner Change4.05%
Ins Owners3.86%
Ins Owner Change-0.11%
Market Cap2.35B
Analysts76.67
Price Target136.48 (-10.7%)
Short Float %11.53%
Short Ratio2.25
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)298.71%
Min EPS beat(2)210.91%
Max EPS beat(2)386.52%
EPS beat(4)4
Avg EPS beat(4)223.67%
Min EPS beat(4)62.56%
Max EPS beat(4)386.52%
EPS beat(8)7
Avg EPS beat(8)128.38%
EPS beat(12)11
Avg EPS beat(12)91.69%
EPS beat(16)14
Avg EPS beat(16)71.39%
Revenue beat(2)2
Avg Revenue beat(2)9.71%
Min Revenue beat(2)9.34%
Max Revenue beat(2)10.07%
Revenue beat(4)4
Avg Revenue beat(4)9%
Min Revenue beat(4)6.71%
Max Revenue beat(4)10.07%
Revenue beat(8)8
Avg Revenue beat(8)20.93%
Revenue beat(12)10
Avg Revenue beat(12)14.03%
Revenue beat(16)14
Avg Revenue beat(16)18.7%
PT rev (1m)14.16%
PT rev (3m)57.41%
EPS NQ rev (1m)216.25%
EPS NQ rev (3m)187.86%
EPS NY rev (1m)356.28%
EPS NY rev (3m)477.32%
Revenue NQ rev (1m)7.8%
Revenue NQ rev (3m)16.15%
Revenue NY rev (1m)2.5%
Revenue NY rev (3m)11.4%
Valuation
Industry RankSector Rank
PE 47.76
Fwd PE 81.61
P/S 1.85
P/FCF 11.95
P/OCF 11.29
P/B 6.89
P/tB 6.89
EV/EBITDA 16.49
EPS(TTM)3.2
EY2.09%
EPS(NY)1.87
Fwd EY1.23%
FCF(TTM)12.78
FCFY8.37%
OCF(TTM)13.53
OCFY8.86%
SpS82.69
BVpS22.17
TBVpS22.17
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 2.95%
ROE 13.71%
ROCE 6.7%
ROIC 5.29%
ROICexc 8.8%
ROICexgc 11.77%
OM 8.06%
PM (TTM) 3.67%
GM N/A
FCFM 15.46%
ROA(3y)-10.55%
ROA(5y)-18.35%
ROE(3y)-40.11%
ROE(5y)-47.17%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.8
Health
Industry RankSector Rank
Debt/Equity 0.58
Debt/FCF 1
Debt/EBITDA 1.69
Cap/Depr 82.14%
Cap/Sales 0.9%
Interest Coverage 250
Cash Conversion 178.69%
Profit Quality 420.77%
Current Ratio 0.37
Quick Ratio 0.37
Altman-Z 0.64
F-Score7
WACC9.61%
ROIC/WACC0.55
Cap/Depr(3y)75.66%
Cap/Depr(5y)79.53%
Cap/Sales(3y)2.11%
Cap/Sales(5y)2.84%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)141.18%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%354.76%
EPS Next Y-39.16%
EPS Next 2Y4.65%
EPS Next 3Y25.01%
EPS Next 5YN/A
Revenue 1Y (TTM)98.66%
Revenue growth 3Y50.46%
Revenue growth 5Y32.31%
Sales Q2Q%37.07%
Revenue Next Year24.01%
Revenue Next 2Y17.25%
Revenue Next 3Y16.46%
Revenue Next 5Y-8.3%
EBIT growth 1Y269.54%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year111.35%
EBIT Next 3Y45.31%
EBIT Next 5Y37.65%
FCF growth 1Y178.07%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y185.56%
OCF growth 3YN/A
OCF growth 5YN/A