The Root Inc (NASDAQ: ROOT) stock had come under considerable selling pressure in recent days but this past Friday, the stock made a strong recovery and surged 7%.
Earlier this month the stock slumped after that analyst at Bank of America securities Joshua Shanker started covering the stock and gave it an ‘underperform’ rating. The analyst stated that Root, which is involved in the insurance technology space, is not going to have a positive cash flow till 2027.
He went on to state that due to this issue, the company is going to need a considerable cash infusion from the markets in order to offset its cash flow troubles. Hence, it did not come as a surprise when Root’s stock experienced a considerable selloff following the research report. However, it seems that some investors might have recognized it as a buying opportunity. It now remains to be seen if the stock manages to consolidate the current position this week.
Finance and Entertainment Reporter
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