Wells Fargo & Company Has Lowered Expectations for Root (NASDAQ:ROOT) Stock Price

Key Points

• Wells Fargo cut Root’s price target from $53 to $47 while maintaining an “equal weight” rating, implying roughly 3.84% downside from the prior close.
• Analyst sentiment is mixed but leans toward “Hold”: Root has one Buy, five Hold, and one Sell rating, with a consensus price target of $58.75.
• Root reported quarterly EPS of $1.49, exceeding the $0.83 consensus estimate, while revenue of $389.2 million grew 1.6% year over year but fell short of expectations.

Root (NASDAQ:ROOT - Get Free Report) had its price target cut by stock analysts at Wells Fargo & Company from $53.00 to $47.00 in a note issued to investors on Monday, Benzinga reports. The firm presently has an "equal weight" rating on the stock. Wells Fargo & Company's price target indicates a potential downside of 3.84% from the stock's previous close.

A number of other research analysts have also recently commented on the company. Weiss Ratings raised Root from a "hold (c-)" rating to a "hold (c)" rating in a research note on Tuesday, July 28th. Keefe, Bruyette & Woods lowered their price target on Root from $95.00 to $80.00 and set an "outperform" rating on the stock in a research report on Thursday, August 6th. TD Cowen lowered Root from a "hold" rating to a "strong sell" rating in a research note on Thursday, August 20th. Finally, Jefferies Financial Group lowered Root from a "buy" rating to a "hold" rating and dropped their price target for the stock from $78.00 to $58.00 in a research note on Tuesday, August 11th. One analyst has rated the stock with a Buy rating, five have assigned a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat, Root currently has an average rating of "Hold" and a consensus price target of $58.75.

Root Price Performance

Shares of NASDAQ:ROOT traded down $0.26 during trading on Monday, reaching $48.88. The company had a trading volume of 35,705 shares, compared to its average volume of 283,311. The company has a fifty day moving average of $52.17 and a two-hundred day moving average of $53.67. The stock has a market capitalization of $757.22 million, a P/E ratio of 13.81 and a beta of 2.91. Root has a 12 month low of $40.91 and a 12 month high of $91.00. The company has a current ratio of 1.02, a quick ratio of 1.02 and a debt-to-equity ratio of 0.60.

Root (NASDAQ:ROOT - Get Free Report) last posted its quarterly earnings data on Wednesday, August 5th. The company reported $1.49 earnings per share for the quarter, beating the consensus estimate of $0.83 by $0.66. Root had a net margin of 3.78% and a return on equity of 19.72%. The firm had revenue of $389.20 million for the quarter, compared to analysts' expectations of $395.14 million. During the same quarter last year, the company posted $1.29 EPS. The business's quarterly revenue was up 1.6% on a year-over-year basis. Equities research analysts forecast that Root will post 4.46 earnings per share for the current year.

Institutional Inflows and Outflows

Several large investors have recently made changes to their positions in ROOT. Sequoia Financial Advisors LLC bought a new stake in shares of Root in the 2nd quarter worth approximately $219,000. Prosperitas Financial LLC boosted its stake in shares of Root by 4.4% in the 2nd quarter. Prosperitas Financial LLC now owns 27,411 shares of the company's stock valued at $1,533,000 after purchasing an additional 1,149 shares in the last quarter. CoreCap Advisors LLC bought a new position in shares of Root during the 2nd quarter valued at $42,000. Quantinno Capital Management LP bought a new position in shares of Root during the 1st quarter valued at $920,000. Finally, First Trust Advisors LP grew its holdings in shares of Root by 49.1% during the 1st quarter. First Trust Advisors LP now owns 68,050 shares of the company's stock valued at $3,006,000 after purchasing an additional 22,422 shares during the last quarter. 59.82% of the stock is owned by hedge funds and other institutional investors.

About Root

Root, Inc NASDAQ: ROOT is a technology-driven insurance company that provides primarily personal automobile insurance. Its platform uses mobile technology and telematics, including driving data collected through a smartphone application, to assess driving behavior and help determine personalized insurance pricing.

Customers can obtain quotes, manage policies, submit claims and access insurance documents through Root's mobile app and online platform. The company's product offering has centered on usage-based auto insurance, with coverage and availability varying by state and applicable regulatory requirements.

Root was founded in 2015 by Alex Timm and Dan Mayer and is headquartered in Columbus, Ohio.

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