how to buy root stock ipo
Source: Root Insurance

How Can Investors Buy the Root Stock IPO?


Oct. 7 2020, Updated 11:30 a.m. ET

On Oct. 5, Root revealed the terms for its IPO in an SEC filing. The company plans to raise up to $100 million. The stock will likely be listed on Nasdaq under the ticker symbol "ROOT." How can investors buy into the Root stock IPO?

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root insurance ipo
Source: Root Insurance

When is the Root stock IPO date?

Root’s IPO date hasn't been set yet. The company hasn’t determined the number of shares that will be offered or the stock price range for the proposed IPO. The SEC filing revealed Root's plan to raise about $100 million. Root’s previous funding round of $350 million was announced in August 2019. The last funding round was led by Coatue Management and DST Global. The funding round valued Root at about $3.65 billion.

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Goldman Sachs, Morgan Stanley, Wells Fargo Securities, and Barclays will act as lead bookrunners for the proposed IPO. Deutsche Bank Securities, Evercore ISI, Credit Suisse, and Truist Securities will serve as additional bookrunners. Also, JMP Securities, Siebert Williams Shank, and Cantor Fitzgerald will serve as co-managers of the proposed offering.

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Where can investors buy the Root stock IPO?

To buy Root stock when it lands on Nasdaq, you will need to have a stock trading account. You can open a brokerage account with online brokers like Webull, SoFi Invest, Robinhood, Vanguard, and Charles Schwab. After you have enough funds in your brokerage account, you can enter a buy order for the stock.

How to buy the Root stock IPO on Robinhood

To buy Root stock on Robinhood, you need to have a Robinhood brokerage account. After you set up a brokerage account and deposit funds into the account, you can enter a buy order for the stock.

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Should you buy the Root stock IPO?

Root was founded in 2015 by Alex Timm and Dan Manges. The company operates through a mobile application that uses telematics, smartphone technology, and data science. Root has started selling home and renters insurance in addition to its main offering, car insurance. Currently, Root is licensed in 36 states and active in about 30 states. The company targets to be licensed in every state by early 2021.

Root’s revenue rose 570.2 percent year-over-year to $290.2 million in 2019. The company reported a $282.4 million loss in 2019, which rose from a $69.1 million loss in 2018. Root’s net revenue rose 135.7 percent in the first six months of 2020 to $245.4 million. The company reported a net loss of $144.5 million in the first six months of 2020 compared to a net loss of $97 million in the same period last year.


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