$ROOT: When the Squozes keep on squoozing, and shorties keep on shorting…
I’m not a financial advisor, nor am I giving any financial advise. This is an entertainment/comedy-nonfactual post. I’m a literal retard posting on WSB with a bias due to having a large position of my portfolio in $ROOT. So, proceed on your own risk… In addition, a lot of my DD was taken from C*(i)Tron.
I’ll keep it short and simple… This is a one of a kind DD where the whole DD is basically a TLDR.
1- Short Interest is 47.36% (Fintel 2021-03-31). In addition, only 2,000 shares were available for shorting on 04-01 2021-04-01 13:08:53 UTC(Fintel) with a borrow rate of 8.71%!!(2021-04-01 18:18:33 UTC). To put things into perspective, If there’s a short interest of %10, that’s considered high. If there’s a short interest of %20 or greater, that’s considered extremely high. We had 47.36% on Thursday so a short squeeze is inevitable?
In comparison of $ROOTS short interest of 47.6%(2021-03-31), $GME has a short interest of 18.81(2021-03-31) and $AMC 17.31%( 2021-03-31).
2- Forget about the short squeeze… It also have a very high potential of gamma squeezing. The open interest of calls is high above 15$. The open interest of all the calls for Only 16 April is 32,261. In addition, the open interest bellow 15$ is 16,414 which equals 1,641,400 shares!!!! .Once it hits and stays above $15, the gamma squeeze could take it to a whole new solar system.
3- ROOT is massively undervalued, Without factoring the massive short squeeze and Gamma squeeze potential, at $LMND multiple $ROOT would trade at $65 and if ROOT is successful in capturing 2% of the $266 billion US auto insurance market then just the insurance side is worth 10x(120$).
BUT… instead of doing Voodoo math, there is no reason this stock is worth less than its IPO price of $27. This is at the cross hairs of disruptive technology that is too strong to ignore.
4- For Growth, the step up in sales and marketing investment appears to be paying off as there is an acceleration in ROOT daily and weekly app downloads this month based on a leading 3rdparty app data(App Annie). Bellow is the Chart:
5- As the end of 2020, ROOT had 323K auto and 8K renters policies in force. According to the NAIC, there were a total of 49 auto and 1 renters complaints against ROOT in 2020. Which indicates the BS that $ROOT shorts are claiming about customer complaints. Additionally, I dare you to find any insurance company without complaints.
6- For the past week, everyday even today(weekend), I was receiving a ThinkOrSwim news notification advertising for a class action lawsuit against $ROOT. Some days I even receive it a few times a day, the same notification. The shorts are relentless in pushing this news while you have to keep in mind that Class Action Lawsuits can take up to several years to conclude. In addition, I dare you to find an old enough (Billion level company) which didn’t or isn’t facing a class action lawsuit. In my opinion, It’s a distraction and FUD in the news cycle by the Shorts. Class action lawsuits are shitty law firms trying to make a name for themselves(IMO).
7- It has a relatively small market cap of 3.07B and a very small float. It reminds me of $GME preSqueeze when it was 3.5-3.7B now it’s(13.39B).
My short term Price target is 50$+ if a Short Squeeze +/- Gamma squeeze perfectly happens
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April 3, 2021 at 01:40PM