I think the OP asked from a algebraic resp. beginners point of view as of calculus, so is my answer:
It assume it is looking for Discriminant
,
fr = FunctionRange[x/(1 + x^2), x, y]
$-\frac{1}{2}\leq y\leq \frac{1}{2}$
fr[[1]]; fr[[5]];
fr == x/(1 + x^2)
$\left(-\frac{1}{2}\leq y\leq \frac{1}{2}\right)=\frac{x}{x^2+1}$
Plot[{x/(1 + x^2), fr[[1]], fr[[5]]}, {x, -2, 2}]

Solve[x/(1 + x^2) == fr[[1]], x]
{{x->-1},{x->-1}}
Solve[x/(1 + x^2) == fr[[5]], x]
{{x -> 1}, {x -> 1}}
Plot[{x/(1 + x^2), fr[[1]], fr[[5]]}, {x, -2, 2},
Epilog -> {Red, PointSize[Large], Point[{{-1, -1/2}, {1, 1/2}}]}]

x == y*(1 + x^2)
$x=\left(x^2+1\right) y$
Expand[%]
$x=x^2 y+y$
Solve[%, x]
$\left\{\left\{x\to \frac{1-\sqrt{1-4 y^2}}{2 y}\right\},\left\{x\to \frac{\sqrt{1-4 y^2}+1}{2 y}\right\}\right\}$
$\mathrm{Because, for\:a\:quadratic\:equation\:of\:the\:form\:}ax^2+bx+c=0\mathrm{\:the\:discriminant\:is\:}b^2-4ac$