Metromile (NASDAQ:MILE – Get Rating) and Root (NASDAQ:ROOT – Get Rating) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, dividends, earnings, risk and institutional ownership.
Risk & Volatility
Metromile has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500. Comparatively, Root has a beta of -0.22, meaning that its stock price is 122% less volatile than the S&P 500.
This is a breakdown of current ratings for Metromile and Root, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Metromile presently has a consensus price target of $4.53, indicating a potential upside of 352.50%. Root has a consensus price target of $4.88, indicating a potential upside of 383.37%. Given Root’s stronger consensus rating and higher probable upside, analysts plainly believe Root is more favorable than Metromile.
Earnings and Valuation
This table compares Metromile and Root’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Metromile||$104.90 million||1.24||-$216.46 million||($1.81)||-0.55|
|Root||$345.40 million||0.74||-$521.10 million||($1.99)||-0.51|
Metromile has higher earnings, but lower revenue than Root. Metromile is trading at a lower price-to-earnings ratio than Root, indicating that it is currently the more affordable of the two stocks.
This table compares Metromile and Root’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
62.5% of Metromile shares are owned by institutional investors. Comparatively, 52.0% of Root shares are owned by institutional investors. 27.6% of Root shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
About Metromile (Get Rating)
Metromile, Inc. provides insurance policies for automobile owners in the United States. It operates through two segments, Insurance Services and Enterprise Business Solutions. The company offers pay-per-mile auto insurance policies. It also provides The Pulse, a device that plugs into the diagnostic port of its customer’s car and transmits data, such as miles driven, driving habits, phone use, speeding, hard braking, accelerating, cornering, and location over wireless cellular networks. In addition, the company offers access to its technology under software as a service arrangement, as well as professional services to third-party customers. Metromile, Inc. was founded in 2011 and is headquartered in San Francisco, California.
About Root (Get Rating)
Root, Inc. provides insurance products and services in the United States. The company offers automobile, homeowners, and renters insurance products. The company operates a direct-to-consumer model and serves customers primarily through mobile applications, as well as through its website. Its direct distribution channels also cover digital, media, and referral channels, as well as distribution partners and agencies. The company was incorporated in 2015 and is headquartered in Columbus, Ohio.
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