Greenlight Capital Re (NASDAQ:GLRE – Get Free Report) and Root (NASDAQ:ROOT – Get Free Report) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, profitability, risk and valuation.
Analyst Ratings
This is a summary of current recommendations for Greenlight Capital Re and Root, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Greenlight Capital Re | 0 | 1 | 1 | 0 | 2.50 |
| Root | 1 | 5 | 1 | 0 | 2.00 |
Root has a consensus target price of $57.75, indicating a potential upside of 31.64%. Given Root’s higher possible upside, analysts clearly believe Root is more favorable than Greenlight Capital Re.
Earnings & Valuation
This table compares Greenlight Capital Re and Root”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Greenlight Capital Re | $647.96 million | 0.82 | $74.83 million | $1.70 | 9.68 |
| Root | $1.52 billion | 0.45 | $40.30 million | $4.75 | 9.24 |
Greenlight Capital Re has higher earnings, but lower revenue than Root. Root is trading at a lower price-to-earnings ratio than Greenlight Capital Re, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
41.5% of Greenlight Capital Re shares are held by institutional investors. Comparatively, 59.8% of Root shares are held by institutional investors. 24.7% of Greenlight Capital Re shares are held by insiders. Comparatively, 12.0% of Root shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Profitability
This table compares Greenlight Capital Re and Root’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Greenlight Capital Re | 8.56% | 8.26% | 2.62% |
| Root | 5.03% | 24.82% | 4.69% |
Risk & Volatility
Greenlight Capital Re has a beta of 0.28, meaning that its share price is 72% less volatile than the S&P 500. Comparatively, Root has a beta of 3.06, meaning that its share price is 206% more volatile than the S&P 500.
Summary
Root beats Greenlight Capital Re on 7 of the 13 factors compared between the two stocks.
About Greenlight Capital Re
Greenlight Capital Re, Ltd. is a specialty property and casualty reinsurer based in the Cayman Islands. Through its reinsurance subsidiaries, the company works with insurers and other businesses to provide coverage for risks they seek to transfer or share. Its business includes property and casualty reinsurance across a range of lines, with underwriting tailored to clients’ risk profiles. Greenlight Re serves customers in multiple markets, including through operations in the Cayman Islands and Ireland.
About Root
Root, Inc. is a technology-focused insurance company that primarily provides personal auto insurance in the United States. Its coverage is offered in participating states, with availability and policy options varying by location. The company uses smartphone technology to assess driving behavior, including factors such as braking and driving patterns, and incorporates that information into its insurance pricing. Customers can use Root’s mobile app to get quotes, manage policies and access insurance services.
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