Root Inc. (NASDAQ:ROOT) shares are trading higher Thursday after the company reported better-than-expected first-quarter financial results.
What To Know: Root reported adjusted earnings per share of $1.07, which may not compare to estimates, but the number is significantly improved from a loss of 42 cents in the first quarter of 2024. Quarterly revenue came in at $349.4 million, beating estimates of $322.66 million, according to Benzinga Pro.
The company highlighted that growth in the quarter was aided by seasonal shopping trends and tax refunds but emphasized that performance was achieved while maintaining strict underwriting discipline. Gross premiums written rose 24% year-over-year and the company posted $18 million in net income, $24 million in operating income and $32 million in adjusted EBITDA.
Root CEO Alex Timm said the uncertain macroeconomic environment presents an opportunity to showcase the company's technology and data science capabilities.
“Our technology and data science capabilities enable us to quickly react to prevailing trends and enhance segmentation to continually offer the best prices to the best drivers,” Timm said in a letter to shareholders.
Following the results, Wells Fargo raised its price target on Root from $105 to $142 while maintaining an Equal-Weight rating. Keefe, Bruyette & Woods also raised its target from $150 to $170 and maintained an Outperform rating.
ROOT Price Action: Root shares were up 4.46% at $146.45 at the time of publication Thursday, according to Benzinga Pro.
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