KAR Auction Services, Inc. [NYSE:KAR]: Analyst Rating and Earnings
Stock market traders frequently keep their eyes on what Wall Street experts as it relates to a potential investment. For KAR Auction Services, Inc. [KAR], the most recent analyst consensus recommendation available since its latest financial results for the quarter ending in December. On average, stock market experts give KAR an Outperform rating. Its stock price has been found in the range of 43.32 to 64.55. This is compared to its latest closing price of $54.15.
Wall Street analysts provide their ratings on a scale of 1 to 5, and the current average score for KAR Auction Services, Inc. [KAR] is sitting at 1.92. This is compared to 1 month ago, when its average rating was 1.92.
For the quarter ending in Dec-18 KAR Auction Services, Inc. [KAR] generated $0.93 billion in sales. That’s 0.72% lower than the average estimate of $0.94 billion as provided by Wall Street analysts. The three indicators above suggest that on the whole, this stock is not presenting an attractive investment option, as there are too many red flags that don’t point to a high-value ROI.
Keep your eyes peeled for the soon-to-be-published financial results of this company, which are expected to be made public on Tue 14 May (In 28 Days).
Fundamental Analysis of KAR Auction Services, Inc. [KAR]
Now let’s turn to look at profitability: with a current Operating Margin for KAR Auction Services, Inc. [KAR] sitting at +16.56 and its Gross Margin at +36.00, this company’s Net Margin is now 8.70%. These metrics indicate that this company is not generating as much profit, after accounting for expenses, compared to its market peers.
This company’s Return on Total Capital is 11.14, and its Return on Invested Capital has reached 12.50%. Its Return on Equity is 22.24, and its Return on Assets is 4.56. These metrics show a mixed bag, which means that this investment’s attractiveness can be quickly increased or decreased in the short term, depending on future updates KAR financial performance.
Turning to investigate this organization’s capital structure, KAR Auction Services, Inc. [KAR] has generated a Total Debt to Total Equity ratio of 284.68. Similarly, its Total Debt to Total Capital is 74.00, while its Total Debt to Total Assets stands at 56.99. Looking toward the future, this publicly-traded company’s Long-Term Debt to Equity is 183.20, and its Long-Term Debt to Total Capital is 47.62. This company is not leveraging its assets to take on debt, which stunts its growth and limits the ROI for investors.
What about valuation? This company’s Enterprise Value to EBITDA is 12.04 and its Total Debt to EBITDA Value is 4.66. The Enterprise Value to Sales for this firm is now 2.86, and its Total Debt to Enterprise Value stands at 0.41. KAR Auction Services, Inc. [KAR] has a Price to Book Ratio of 4.33, a Price to Cash Flow Ratio of 8.78 and P/E Ratio of 22.92. These metrics show that this company has a mixed appeal, and ROI could be a gain or a loss.
Shifting the focus to workforce efficiency, KAR Auction Services, Inc. [KAR] earns $204,870 for each employee under its payroll. Similarly, this company’s Receivables Turnover is 1.40 and its Total Asset Turnover is 0.52. This publicly-traded organization’s liquidity data is also interesting: its Quick Ratio is 1.26 and its Current Ratio is 1.26. This company, considering these metrics, has a healthy ratio between its short-term liquid assets and its short-term liabilities, making it a less risky investment.
KAR Auction Services, Inc. [KAR] has 132.83M shares outstanding, amounting to a total market cap of $7.36B. Its stock price has been found in the range of 43.32 to 64.55. At its current price, it has moved by -14.14% from its 52-week high, and it has moved 27.94% from its 52-week low.
This stock’s Beta value is currently 1.14, which indicates that it is more volatile that the wider market. This stock’s Relative Strength Index (RSI) is at 69.85. This RSI score is good, suggesting this stock is neither overbought or oversold.
Conclusion: Is KAR Auction Services, Inc. [KAR] a Reliable Buy?
Shares of KAR Auction Services, Inc. [KAR], on the whole, present investors with both positive and negative signals. Wall Street analysts have mixed reviews when it comes to the 12-month price outlook, and this company’s financials show a combination of strengths and weaknesses. Based on the price performance, this investment is somewhat risky while presenting reasonable potential for ROI.