TrueCar Receives a New Rating from Benchmark Co.

By Jason Carr

TrueCar (NASDAQ: TRUE) received a Buy rating and a $18 price target from Benchmark Co. analyst Daniel Kurnos today. The company’s shares closed yesterday at $9.93, close to its 52-week low of $9.63.

Kurnos wrote:

“We view the bull case for TRUE as a healthy mix of execution and a longer-tailed market expansion opportunity. Even though 50% of revenue comes from a subscription model vs. a pay per list system, the subscription model is both backwards looking and has a pay per sale underpinning. This puts TrueCar as the only transaction-based model in our universe, a model which clearly appeals to dealers who effectively get exactly what they pay for. Near-term, the story is likely to be about improving registration levels from mid-single digits via enhancing the consumer experience and giving the consumer more tools and control to participate in the marketplace. Longer-term, improvements in branding, along with increased transparency in all aspects of the car buying process, should lead to an uptick in traffic, OEM spend and dealer wallet share via increased available unit volume.”

According to TipRanks.com, Kurnos is a 5-star analyst with an average return of 11.3% and a 53.9% success rate. Kurnos covers the Services sector, focusing on stocks such as Sinclair Broadcast, 1-800 Flowers.com, and Zillow Group Inc.

TrueCar has an analyst consensus of Moderate Buy, with a price target consensus of $16.

Based on TrueCar’s latest earnings report for the quarter ending December 31, the company posted quarterly revenue of $83.13 million and GAAP net loss of $8.48 million. In comparison, last year the company earned revenue of $74.08 million and had a GAAP net loss of $7.95 million.

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TrueCar, Inc. engages in the operation of data-driven online platform which provides dealers and automakers with automobile information. It provides pricing transparency about what other people paid for their cars. The company products include Used Cars for Sale, Sell My Car, Local Pricing, and Lease a Car.