Hagerty (NYSE:HGTY) & Root (NASDAQ:ROOT) Head to Head Contrast

Root (NASDAQ:ROOT) and Hagerty (NYSE:HGTY) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, dividends, analyst recommendations, profitability, valuation and risk.

Analyst Ratings

This is a summary of recent recommendations and price targets for Root and Hagerty, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Root	1	5	2	0	2.13
Hagerty	0	4	5	0	2.56

Root presently has a consensus price target of $121.60, suggesting a potential upside of 95.72%. Hagerty has a consensus price target of $14.13, suggesting a potential upside of 11.50%. Given Root’s higher possible upside, equities research analysts clearly believe Root is more favorable than Hagerty.

Profitability

This table compares Root and Hagerty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Root	3.80%	23.36%	3.49%
Hagerty	5.85%	16.85%	4.94%

Institutional & Insider Ownership

59.8% of Root shares are owned by institutional investors. Comparatively, 20.5% of Hagerty shares are owned by institutional investors. 11.8% of Root shares are owned by insiders. Comparatively, 16.7% of Hagerty shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Root and Hagerty”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Root	$1.18 billion	0.82	$30.90 million	$3.31	18.77
Hagerty	$1.20 billion	3.61	$17.02 million	$0.28	45.24

Root has higher earnings, but lower revenue than Hagerty. Root is trading at a lower price-to-earnings ratio than Hagerty, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Root has a beta of 2.7, suggesting that its stock price is 170% more volatile than the S&P 500. Comparatively, Hagerty has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.

Summary

Hagerty beats Root on 8 of the 14 factors compared between the two stocks.

About Root

Root, Inc. provides insurance products and services in the United States. The company offers automobile, homeowners, and renters insurance products. It operates a direct-to-consumer model; and serves customers primarily through mobile applications, as well as through its website. The company's direct distribution channels also cover digital, media, and referral channels, as well as distribution partners and agencies. Root, Inc. was incorporated in 2015 and is headquartered in Columbus, Ohio.

About Hagerty

Hagerty, Inc. provides insurance agency services worldwide. It offers motor vehicle and boat insurance products; and reinsurance products. The company provides Hagerty Media, which publishes contents through the Hagerty Drivers Club Magazine (HDC), video content, and social media channels; HDC that offers subscription based products and services, including HDC Magazine, automotive enthusiast events, proprietary vehicle valuation tools, emergency roadside services, and special vehicle-related discounts. In addition, it offers HVT, a valuation tool used by the customer to access current and historic pricing data of collector vehicle models. Further, the company offers Hagerty Garage + Social, a platform that provides clubhouses and car storage facilities. Hagerty, Inc. is headquartered in Traverse City, Michigan.