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Root, Inc. (ROOT) Surges 18.6%: Is This an Indication of Further Gains?

Root, Inc. (ROOT) shares rallied 18.6% in the last trading session to close at $12.63. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 76.9% gain over the past four weeks.

ROOT remains focused to accelerate adoption rates by building on a flexible technology stack. Continuous advancement through API developments aids ROOT to rapidly scale and add new partnerships while materially reducing the cost and time to deployment for those partners.

Developing products to incorporate telematics with each of embedded partners. The company stated telematics is and has always been a meaningful differentiation for Root. The company stays focused  to prioritize loss ratio improvements.

This company is expected to post quarterly loss of $3 per share in its upcoming report, which represents a year-over-year change of +53.6%. Revenues are expected to be $73 million, down 9.2% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Root, Inc., the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on ROOT going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Root, Inc. is part of the Zacks Insurance - Property and Casualty industry. RLI Corp. (RLI), another stock in the same industry, closed the last trading session 0.2% lower at $135.61. RLI has returned 4.6% in the past month.

For RLI Corp. , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.20. This represents a change of -19.5% from what the company reported a year ago. RLI Corp. currently has a Zacks Rank of #1 (Strong Buy).

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