Root, Inc. (ROOT) stock analysis
Close on Nov 12, 2026Market cap $675.97MP/E 9.2Yield –
StockData Score
Prices as of Nov 11, 2026How the score works
Mixed9 of 30 checks passed
Root passes 9 of the 30 checks behind our score; 16 could not be run for lack of data and count as not passed. Each dot in the shape is one check — hover it for the numbers.
- Valuation
- 3/6
- Growth
- 2/6
- Past performance
- 3/6
- Financial health
- 1/6
- Dividend
- 0/6
What stands out
Trading below fair value
The share price of $43.97 is below our fair value estimate of $47.16.
Revenue growing 10%+ a year
Revenue grew 69.6% a year over the last three fiscal years.
Interest well covered
Operating income covers interest expense 5.9 times.
P/E below the industry
Root's P/E of 9.3 is below the Fire, Marine, and Casualty Insurance median of 10.4.
What to watch
Margin of safety under 20%
The price is 6.8% below fair value, less than the 20% cushion we look for.
Return on equity under 15%
Return on equity was 27.4% over the last twelve months and averaged -34.6% over five years; we look for 15% on both.
P/B above the industry
Root's price-to-book of 2.08 is above the Fire, Marine, and Casualty Insurance median of 1.62.
Net margin below the industry
Root's net margin of 5.2% is below the Fire, Marine, and Casualty Insurance median of 12.0%.
Valuation3/6
P/E against its history
Not enough price and earnings history to compare.
P/E below the industry
Root's P/E of 9.3 is below the Fire, Marine, and Casualty Insurance median of 10.4.
P/S below the industry
Root's price-to-sales of 0.44 is below the Fire, Marine, and Casualty Insurance median of 1.28.
P/B above the industry
Root's price-to-book of 2.08 is above the Fire, Marine, and Casualty Insurance median of 1.62.
Trading below fair value
The share price of $43.97 is below our fair value estimate of $47.16.
Margin of safety under 20%
The price is 6.8% below fair value, less than the 20% cushion we look for.
Growth2/6
Revenue growing 10%+ a year
Revenue grew 69.6% a year over the last three fiscal years.
EPS growth over 3 years
Needs positive EPS three years ago and today.
Earnings acceleration
Needs positive net income now, a year ago and five years ago.
Growing faster than the industry
Revenue grew 7.9% over the last twelve months; the Fire, Marine, and Casualty Insurance median is 5.0%.
Company guidance
No outlook found in earnings releases from the last twelve months.
Gross margin trend
Banks and insurers do not report gross profit.
Past performance3/6
Return on equity under 15%
Return on equity was 27.4% over the last twelve months and averaged -34.6% over five years; we look for 15% on both.
Return on assets over 1%
Return on assets was 4.9%; for a bank or insurer, 1% or more is considered good.
Return on equity above the industry
Root's return on equity of 27.4% is above the Fire, Marine, and Casualty Insurance median of 15.9%.
Earnings over 5 years
Needs positive net income five years ago and in the latest year.
Net margin above its 5-year average
Net margin was 5.2% over the last twelve months, against a 5-year average of -54.8%.
Net margin below the industry
Root's net margin of 5.2% is below the Fire, Marine, and Casualty Insurance median of 12.0%.
Financial health1/6
Debt level
Needs debt and equity figures.
Debt trend
Needs a balance sheet from five years ago with positive equity.
Debt coverage
Needs operating cash flow.
Interest well covered
Operating income covers interest expense 5.9 times.
Short-term liquidity
Insurers do not split assets into current and non-current.
Bankruptcy risk (Altman Z)
The Altman model does not apply to insurers.
Dividend0/6
No dividend
Root has not paid a dividend in the last twelve months.
Yield against Treasuries
No dividend.
Yield against the market
No dividend.
Dividend stability
No dividend.
Earnings cover
No dividend.
Cash-flow cover
No dividend.
Fair value
How we estimate itOur estimate per share
$47.16
The share price is 7% below this estimate.
| Method | Multiple used | Own 5Y median | Industry median | Value per share | Weight |
|---|---|---|---|---|---|
| P/E | 10.4× | – | 10.4× | $49.33 | 50% |
| P/B | 2.1× | 2.6× | 1.6× | $44.99 | 50% |
| Fair value | $47.16 | 100% | |||
Valuation over time
Using the earnings and balance sheet published at each date, not today's.
- P/E at month end
- Fire, Marine, and Casualty Insurance median 10.4
An estimate from reported numbers and market multiples, not a price target or investment advice. It can be far off for companies whose profits are about to change sharply.
Market risk
From the past year of daily prices.
Liquidity
Medium risk
- Average value traded per day
- $9.20M
- Value traded per 1% price move
- $4.66M
Downside
High risk
- Typical loss in a bad month
- 25.9%
- Volatility (annualized)
- 65%
- Sharpe ratio, 1 year
- -0.87
- Beta to the S&P 500 (5Y)
- 1.85
Typical bad-month loss, week by week
Margins
Share of revenue, fiscal years 2017 to 2025
Operating margin
Net margin
Growth rates
Compound annual growth to fiscal 2025
| Per year | 1 year | 3 years | 5 years | 10 years | Five-year pace |
|---|---|---|---|---|---|
| Revenue | +29.0% | +69.6% | +34.3% | – | |
| Operating income | -21.3% | – | – | – | |
| Net income | +30.4% | – | – | – | |
| EPS, diluted | +29.0% | – | – | – | |
| Free cash flow | +5.7% | – | – | – |
Returns and balance sheet
9 fiscal years. Hover a measure to see how it is calculated.
| Measure | FY2017 | FY2020 | FY2025 | Trend |
|---|---|---|---|---|
| Return on equity | – | -110.4% | 16.5% | |
| Return on assets | – | -29.1% | 2.5% | |
| Interest coverage | – | -3.7× | 2.9× | |
| Capex to revenue | – | 0.5% | 0.0% | |
| Diluted shares | – | 4M | 17M |
Where the cash went
Fiscal 2021 to 2025, five years combined
Root generated $1.05B from operations and spent $5.20M on capital expenditure, dividends and share buybacks. 100% of that went back into the business.
DuPont analysis
Return on equity split into margin, efficiency and leverage
| Fiscal year | Net margin | Asset turnover | Equity multiplier | Return on equity |
|---|---|---|---|---|
| FY2025 | 2.7% | 0.96× | 6.50× | 16.5% |
| FY2024 | 2.6% | 0.83× | 7.70× | 16.7% |
| FY2023 | -32.4% | 0.34× | 6.01× | -66.6% |
| FY2022 | -95.8% | 0.24× | 3.24× | -73.2% |
| FY2021 | -150.9% | 0.22× | 1.97× | -66.5% |
| FY2020 | -104.7% | 0.28× | 3.79× | -110.4% |
Piotroski F-Score
Nine tests of profitability, balance sheet and efficiency, fiscal 2025 against fiscal 2024
- ProfitableNet income above zero$40.30M
- Cash generatingOperating cash flow above zero$206.50M
- Return on assets improvedROA up on the prior year2.3% → 2.7%
- Earnings backed by cashOperating cash flow above net income$206.50M vs $40.30M
- Less leverageLong-term debt to assets fell– → –
- Better liquidityCurrent ratio rose– → –
- No dilutionShare count did not rise17M → 17M
- Gross margin improvedGross margin up on the prior year– → –
- More efficientAsset turnover rose0.87 → 1.01
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