Loading...

KAR Auction Services

NYSE:KAR
Snowflake Description

Imperfect balance sheet with questionable track record.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
KAR
NYSE
$8B
Market Cap
  1. Home
  2. US
  3. Commercial Services
Company description

KAR Auction Services, Inc., together with its subsidiaries, provides used car auction and salvage auction services in the United States, Canada, Mexico, and the United Kingdom. The last earnings update was 42 days ago. More info.


Add to Portfolio Compare Print
KAR Share Price and Events
7 Day Returns
0.2%
NYSE:KAR
0.2%
US Commercial Services
0.1%
US Market
1 Year Returns
8.2%
NYSE:KAR
11.4%
US Commercial Services
1.2%
US Market
KAR Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
KAR Auction Services (KAR) 0.2% 10.2% 21.4% 8.2% 51.8% 92%
US Commercial Services 0.2% 3.4% 8.8% 11.4% 57.4% 75.4%
US Market 0.1% 0.6% 0.9% 1.2% 36.7% 37.9%
1 Year Return vs Industry and Market
  • KAR underperformed the Commercial Services industry which returned 11.4% over the past year.
  • KAR outperformed the Market in United States of America which returned 1.2% over the past year.
Price Volatility
KAR
Industry
5yr Volatility vs Market
Related Companies

KAR Value

 Is KAR Auction Services undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of KAR Auction Services to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for KAR Auction Services.

NYSE:KAR Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 10 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 8.8%
Perpetual Growth Rate 10-Year US Government Bond Rate 2.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NYSE:KAR
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 2.7%
Equity Risk Premium S&P Global 6%
Commercial Services Unlevered Beta Simply Wall St/ S&P Global 0.68
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.685 (1 + (1- 21%) (63.96%))
1.021
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.02
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.73% + (1.021 * 5.96%)
8.81%

Discounted Cash Flow Calculation for NYSE:KAR using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for KAR Auction Services is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

NYSE:KAR DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 8.81%)
2019 574.75 Analyst x2 528.20
2020 582.57 Analyst x3 492.02
2021 592.84 Est @ 1.76% 460.13
2022 605.01 Est @ 2.05% 431.55
2023 618.65 Est @ 2.26% 405.54
2024 633.49 Est @ 2.4% 381.63
2025 649.31 Est @ 2.5% 359.48
2026 665.98 Est @ 2.57% 338.84
2027 683.41 Est @ 2.62% 319.55
2028 701.52 Est @ 2.65% 301.45
Present value of next 10 years cash flows $4,018.38
NYSE:KAR DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= $701.52 × (1 + 2.73%) ÷ (8.81% – 2.73%)
$11,846.25
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $11,846.25 ÷ (1 + 8.81%)10
$5,090.40
NYSE:KAR Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $4,018.38 + $5,090.40
$9,108.78
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $9,108.78 / 133.43
$68.27
NYSE:KAR Discount to Share Price
Calculation Result
Value per share (USD) From above. $68.27
Current discount Discount to share price of $60.37
= -1 x ($60.37 - $68.27) / $68.27
11.6%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price KAR Auction Services is available for.
Intrinsic value
12%
Share price is $60.37 vs Future cash flow value of $68.27
Current Discount Checks
For KAR Auction Services to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • KAR Auction Services's share price is below the future cash flow value, but not at a moderate discount (< 20%).
  • KAR Auction Services's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for KAR Auction Services's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are KAR Auction Services's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NYSE:KAR PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-03-31) in USD $2.36
NYSE:KAR Share Price ** NYSE (2019-06-18) in USD $60.37
United States of America Commercial Services Industry PE Ratio Median Figure of 46 Publicly-Listed Commercial Services Companies 25.13x
United States of America Market PE Ratio Median Figure of 3,092 Publicly-Listed Companies 17.63x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of KAR Auction Services.

NYSE:KAR PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NYSE:KAR Share Price ÷ EPS (both in USD)

= 60.37 ÷ 2.36

25.6x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • KAR Auction Services is overvalued based on earnings compared to the US Commercial Services industry average.
  • KAR Auction Services is overvalued based on earnings compared to the United States of America market.
Price based on expected Growth
Does KAR Auction Services's expected growth come at a high price?
Raw Data
NYSE:KAR PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 25.6x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 10 Analysts
10.5%per year
United States of America Commercial Services Industry PEG Ratio Median Figure of 33 Publicly-Listed Commercial Services Companies 1.75x
United States of America Market PEG Ratio Median Figure of 2,126 Publicly-Listed Companies 1.53x

*Line of best fit is calculated by linear regression .

NYSE:KAR PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 25.6x ÷ 10.5%

2.44x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • KAR Auction Services is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on KAR Auction Services's assets?
Raw Data
NYSE:KAR PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-03-31) in USD $11.27
NYSE:KAR Share Price * NYSE (2019-06-18) in USD $60.37
United States of America Commercial Services Industry PB Ratio Median Figure of 87 Publicly-Listed Commercial Services Companies 1.88x
United States of America Market PB Ratio Median Figure of 5,244 Publicly-Listed Companies 1.79x
NYSE:KAR PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NYSE:KAR Share Price ÷ Book Value per Share (both in USD)

= 60.37 ÷ 11.27

5.35x

* Primary Listing of KAR Auction Services.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • KAR Auction Services is overvalued based on assets compared to the US Commercial Services industry average.
X
Value checks
We assess KAR Auction Services's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Commercial Services industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Commercial Services industry average (and greater than 0)? (1 check)
  5. KAR Auction Services has a total score of 0/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

KAR Future Performance

 How is KAR Auction Services expected to perform in the next 1 to 3 years based on estimates from 10 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
10.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is KAR Auction Services expected to grow at an attractive rate?
  • KAR Auction Services's earnings growth is expected to exceed the low risk savings rate of 2.7%.
Growth vs Market Checks
  • KAR Auction Services's earnings growth is positive but not above the United States of America market average.
  • KAR Auction Services's revenue growth is positive but not above the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NYSE:KAR Future Growth Rates Data Sources
Data Point Source Value (per year)
NYSE:KAR Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 10 Analysts 10.5%
NYSE:KAR Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 10 Analysts 5.2%
United States of America Commercial Services Industry Earnings Growth Rate Market Cap Weighted Average 15.3%
United States of America Commercial Services Industry Revenue Growth Rate Market Cap Weighted Average 5.8%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 13.9%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.4%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NYSE:KAR Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 10 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NYSE:KAR Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2020-12-31 4,302 715 375 10
2019-12-31 4,106 625 337 10
NYSE:KAR Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2019-03-31 3,866 691 316
2018-12-31 3,770 750 328
2018-09-30 3,731 687 434
2018-06-30 3,641 602 419
2018-03-31 3,542 599 383
2017-12-31 3,458 589 362
2017-09-30 3,381 575 235
2017-06-30 3,328 587 226
2017-03-31 3,258 450 231
2016-12-31 3,150 378 222
2016-09-30 3,070 451 225
2016-06-30 2,947 439 223

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • KAR Auction Services's earnings are expected to grow by 10.5% yearly, however this is not considered high growth (20% yearly).
  • KAR Auction Services's revenue is expected to grow by 5.2% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NYSE:KAR Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 10 Analyst Estimates (S&P Global) See Below

All data from KAR Auction Services Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:KAR Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2020-12-31 2.70 2.89 2.51 6.00
2019-12-31 2.45 2.56 2.29 6.00
NYSE:KAR Past Financials Data
Date (Data in USD Millions) EPS *
2019-03-31 2.36
2018-12-31 2.44
2018-09-30 3.22
2018-06-30 3.10
2018-03-31 2.82
2017-12-31 2.66
2017-09-30 1.71
2017-06-30 1.65
2017-03-31 1.68
2016-12-31 1.62
2016-09-30 1.64
2016-06-30 1.62

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Unable to establish if KAR Auction Services will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess KAR Auction Services's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
KAR Auction Services has a total score of 1/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

KAR Past Performance

  How has KAR Auction Services performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare KAR Auction Services's growth in the last year to its industry (Commercial Services).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • KAR Auction Services has delivered over 20% year on year earnings growth in the past 5 years.
  • KAR Auction Services's 1-year earnings growth is negative, it can't be compared to the 5-year average.
  • KAR Auction Services's 1-year earnings growth is negative, it can't be compared to the US Commercial Services industry average.
Earnings and Revenue History
KAR Auction Services's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from KAR Auction Services Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:KAR Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-03-31 3,865.90 315.80 744.90
2018-12-31 3,769.60 328.00 724.70
2018-09-30 3,731.00 433.50 721.90
2018-06-30 3,640.50 418.80 693.70
2018-03-31 3,541.90 382.80 670.20
2017-12-31 3,458.00 362.00 640.20
2017-09-30 3,381.30 234.70 616.50
2017-06-30 3,327.90 226.30 607.10
2017-03-31 3,258.40 230.90 599.40
2016-12-31 3,150.10 222.40 583.10
2016-09-30 3,069.60 225.20 562.80
2016-06-30 2,946.70 223.10 545.00
2016-03-31 2,816.50 220.80 521.60
2015-12-31 2,690.60 214.60 502.00
2015-09-30 2,563.40 216.60 487.30
2015-06-30 2,485.80 211.80 475.30
2015-03-31 2,413.10 203.10 466.10
2014-12-31 2,417.00 169.30 471.40
2014-09-30 2,299.10 101.40 514.30
2014-06-30 2,243.70 76.70 518.10
2014-03-31 2,199.50 59.30 516.00
2013-12-31 2,173.30 67.70 490.00
2013-09-30 2,126.40 108.20 433.30
2013-06-30 2,067.60 104.60 415.30
2013-03-31 2,014.10 95.10 406.60
2012-12-31 1,963.40 92.00 419.90
2012-09-30 1,949.50 83.60 426.80
2012-06-30 1,923.70 96.60 404.90

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Whilst KAR Auction Services has efficiently used shareholders’ funds last year (Return on Equity greater than 20%), this is metric is skewed due to its high level of debt.
  • KAR Auction Services used its assets less efficiently than the US Commercial Services industry average last year based on Return on Assets.
  • KAR Auction Services has improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess KAR Auction Services's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Commercial Services industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
KAR Auction Services has a total score of 2/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

KAR Health

 How is KAR Auction Services's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up KAR Auction Services's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • KAR Auction Services is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • KAR Auction Services's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of KAR Auction Services's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is not covered by short term assets, assets are 0.8x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from KAR Auction Services Company Filings, last reported 2 months ago.

NYSE:KAR Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-03-31 1,502.50 5,151.80 265.60
2018-12-31 1,464.20 4,112.70 337.10
2018-09-30 1,561.50 4,041.60 455.10
2018-06-30 1,512.50 4,036.60 369.80
2018-03-31 1,520.10 4,035.30 330.80
2017-12-31 1,484.90 4,038.20 317.20
2017-09-30 1,402.70 3,947.10 432.10
2017-06-30 1,461.80 3,917.80 530.40
2017-03-31 1,430.40 3,640.30 188.00
2016-12-31 1,397.30 3,750.60 201.80
2016-09-30 1,477.80 3,671.60 323.10
2016-06-30 1,459.30 3,634.20 314.70
2016-03-31 1,423.70 3,613.10 676.30
2015-12-31 1,386.10 3,054.10 155.00
2015-09-30 1,377.00 2,991.00 125.30
2015-06-30 1,572.00 2,879.40 204.80
2015-03-31 1,550.10 2,636.60 178.40
2014-12-31 1,547.10 2,619.50 152.90
2014-09-30 1,534.80 2,652.50 214.90
2014-06-30 1,522.10 2,596.40 285.30
2014-03-31 1,483.90 2,551.20 251.20
2013-12-31 1,481.80 2,539.60 191.60
2013-09-30 1,483.90 2,512.70 196.00
2013-06-30 1,459.60 2,525.30 168.10
2013-03-31 1,444.80 2,639.10 322.10
2012-12-31 1,443.70 2,531.60 108.70
2012-09-30 1,445.40 2,455.70 163.70
2012-06-30 1,408.30 2,460.20 117.10
  • KAR Auction Services's level of debt (275.4%) compared to net worth is high (greater than 40%).
  • The level of debt compared to net worth has increased over the past 5 years (171.9% vs 275.4% today).
  • Debt is not well covered by operating cash flow (16.7%, less than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 3.1x coverage).
X
Financial health checks
We assess KAR Auction Services's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. KAR Auction Services has a total score of 2/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

KAR Dividends

 What is KAR Auction Services's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
2.32%
Current annual income from KAR Auction Services dividends. Estimated to be 2.36% next year.
If you bought $2,000 of KAR Auction Services shares you are expected to receive $46 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • KAR Auction Services's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.46%).
  • KAR Auction Services's dividend is below the markets top 25% of dividend payers in United States of America (3.72%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NYSE:KAR Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 10 Analyst Estimates (S&P Global) See Below
United States of America Commercial Services Industry Average Dividend Yield Market Cap Weighted Average of 41 Stocks 1.7%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 2011 Stocks 2.5%
United States of America Minimum Threshold Dividend Yield 10th Percentile 0.8%
United States of America Bottom 25% Dividend Yield 25th Percentile 1.5%
United States of America Top 25% Dividend Yield 75th Percentile 3.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NYSE:KAR Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2020-12-31 1.45 3.00
2019-12-31 1.40 3.00
NYSE:KAR Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2019-05-08 1.400 2.449
2019-05-07 1.400 2.534
2019-02-21 1.400 2.732
2019-02-19 1.400 2.835
2018-11-07 1.400 2.699
2018-11-06 1.400 2.464
2018-08-08 1.400 2.328
2018-08-07 1.400 2.304
2018-02-20 1.400 2.550
2017-11-01 1.400 2.755
2017-10-31 1.400 2.956
2017-08-09 1.280 2.781
2017-08-08 1.280 3.041
2017-05-10 1.280 3.020
2017-05-09 1.280 3.001
2017-02-24 1.280 2.928
2017-02-21 1.280 2.838
2016-11-04 1.280 2.960
2016-11-03 1.280 3.164
2016-08-03 1.160 2.737
2016-08-02 1.160 2.776
2016-05-04 1.160 2.830
2016-05-03 1.160 3.062
2016-02-18 1.160 3.123
2016-02-17 1.160 3.457
2015-11-05 1.080 3.036
2015-11-04 1.080 2.838
2015-08-04 1.080 2.893
2015-08-03 1.080 2.779
2015-05-06 1.080 2.855
2015-05-05 1.080 2.938
2015-02-18 1.080 2.887
2015-02-17 1.080 2.979
2014-11-05 1.080 3.139
2014-11-04 1.080 3.435
2014-05-05 1.000 3.334
2013-11-05 1.000 3.419
2013-08-06 0.760 2.711
2013-05-01 0.760 3.201
2013-02-20 0.760 3.689
2012-11-30 0.760 3.766

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Whilst dividend payments have been stable, KAR Auction Services has been paying a dividend for less than 10 years.
  • Dividend payments have increased, but KAR Auction Services only paid a dividend in the past 7 years.
Current Payout to shareholders
What portion of KAR Auction Services's earnings are paid to the shareholders as a dividend.
  • Dividends paid are covered by earnings (1.7x coverage).
Future Payout to shareholders
  • Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.
X
Income/ dividend checks
We assess KAR Auction Services's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.8%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can KAR Auction Services afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. KAR Auction Services has a total score of 2/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

KAR Management

 What is the CEO of KAR Auction Services's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Jim Hallett
COMPENSATION $6,138,226
AGE 65
TENURE AS CEO 9.8 years
CEO Bio

Mr. James P. Hallett, also known as Jim, has been the Chief Executive Officer of KAR Auction Services, Inc. since September 08, 2009 and Chairman of the Board since December 31, 2014. Mr. Hallett serves as Chairman and CEO at Insurance Auto Auctions, Inc. He serves as Chief Executive Officer and President of ADESA Missouri Redevelopment Corporation, Adesa Of Lexington, Inc and ADESA Ohio, LLC. He serves as Chief Executive Officer, President and Manager of ADESA Virginia, LLC, ADESA Washington, LLC, ADESA Florida, LLC. Mr. Hallett serves as a Member of the Management Board at Kar Holdings II, LLC. He serves as Manager of CarBuyCo, LLC, ADESA Mexico, LLC and ADESA-South Florida, LLC. Mr. Hallett has significant experience in the automotive auctions industry. He served as Chief Executive Officer and President of Tri-State Auction Co., Inc., Zabel & Associates, Inc. and Adesa Texas Inc. He served as Chief Executive Officer and President of A.D.E. Of Ark-La-Tex, Inc., ADESA Sioux Falls, ADESA Mexico, LLC and ADESA-South Florida, LLC. He served as Chief Executive Officer and President of ADESA New York, LLC since April 2007. He served as Chief Executive Officer, President and Manager of Auto Dealers Exchange Of Concord, LLC, Dent Demon, Inc., ADESA Phoenix, LLC, ADESA Pennsylvania, LLC, ADESA New Jersey, LLC, ADESA Oklahoma, LLC, ADESA California, LLC, ADESA Lansing, LLC, ADESA Arkansas, LLC, ADESA Missouri, LLC, Adesa Des Moines, ADESA Wisconsin, LLC, Adesa Atlanta, Llc, ADESA Colorado, LLC, Adesa Southern Indiana, Inc, ADESA Charlotte, LLC, ADESA Ark-La-Tex, LLC and A.D.E. of Knoxville, LLC. He served as Chief Executive Officer and President of ADESA San Diego and Auto Dealers Exchange of Memphis, LLC. He was the President of the Columbus Fair Auto Auction until April 2007. He served as Chief Executive Officer and President of ADESA Auctions since April 2007 until September 2009. He served as the Chief Executive Officer of ADESA Canada Corp. He served as the Chief Executive Officer of KAR Holdings Inc. since September 8, 2009. He served as Chief Executive Officer and President of ALLETE Automotive Services Inc. since November 5, 2001. He served as Chief Executive Officer and President of ADESA, Inc. from April 2007 to September 2009. He served as President of ADESA, Inc. (also known as ADESA Corporation) since January 30, 2004. He served as Executive Vice President and Manager of ADESA Corporation. He served as Chief Executive Officer and President of Adesa Auction Birmingham since April 2007. He served as an Executive Vice President of Adesa Inc. from May 2004 to May 2005 and its Vice President and Chief Operating Officer since March 2004. He served as the Chief Operating Officer of Adesa Corporation LLC. from August 1996 to October 2001 and from January 2003 to March 2004. He served as an Executive Vice President of Allete, Inc. from April 23, 1997 to May 2004. He served as the Chairman of the Board of Allete Automotive Services Inc., a subsidiary of Allete, Inc., from November 5, 2001 to January 2003. From October 2001 to July 2003, he served as the Chairman of Adesa Inc. He has been a Director of Insurance Auto Auctions Inc. since April 2007 and of United Way of Central Indiana Inc. since November 5, 2015. He serves as a Director of ADESA Ohio, LLC. He serves as Director of ADESA Missouri Redevelopment Corporation, ADESA Sioux Falls, Tri-State Auction Co., Inc., ADESA, Inc., Automotive Finance Corporation and ALLETE, Inc. He has been a Director of Kar Auction Services Inc. since April 2007. He serves as a Director of AutoVIN Inc. and Adesa Indianapolis, Inc. Mr. Hallett served as a Director of Adesa Texas Inc., Auto Dealers Exchange of Memphis, LLC, Par, Inc., and A.D.E. Of Ark-La-Tex, Inc. He served as a Director of ADESA New York, LLC, ADESA Auctions and Zabel & Associates, Inc.

CEO Compensation
  • Jim's compensation has been consistent with company performance over the past year, both up more than 20%.
  • Jim's remuneration is about average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the KAR Auction Services management team in years:

2
Average Tenure
50
Average Age
  • The tenure for the KAR Auction Services management team is about average.
Management Team

Jim Hallett

TITLE
Chairman & CEO
COMPENSATION
$6M
AGE
65
TENURE
9.8 yrs

Eric Loughmiller

TITLE
Executive VP & CFO
COMPENSATION
$2M
AGE
58
TENURE
12.2 yrs

Becca Polak

TITLE
Chief Legal Officer & Secretary and President of TradeRev
COMPENSATION
$2M
AGE
47
TENURE
1.7 yrs

Don Gottwald

TITLE
Chief Strategy Officer and President of Digital
COMPENSATION
$2M
AGE
51
TENURE
1.8 yrs

John Hammer

TITLE
President of ADESA
COMPENSATION
$2M
AGE
47
TENURE
1.3 yrs

Peter Kelly

TITLE
President
COMPENSATION
$2M
AGE
49
TENURE
0.4 yrs

Tom Fisher

TITLE
Executive VP & Chief Information Officer
AGE
44
TENURE
2.2 yrs

Mike Eliason

TITLE
VP of Investor Relations & Treasurer
TENURE
3.1 yrs

Tobin Richer

TITLE
Senior Vice President of Marketing & Communications
TENURE
0.5 yrs

Warren Byrd

TITLE
Executive Vice President of Corporate Development & Real Estate
AGE
55
TENURE
9 yrs
Board of Directors Tenure

Average tenure and age of the KAR Auction Services board of directors in years:

5
Average Tenure
64
Average Age
  • The tenure for the KAR Auction Services board of directors is about average.
Board of Directors

Donna Ecton

TITLE
Independent Director
COMPENSATION
$220K
AGE
71
TENURE
5.5 yrs

Jim Hallett

TITLE
Chairman & CEO
COMPENSATION
$6M
AGE
65
TENURE
4.5 yrs

Michael Kestner

TITLE
Independent Director
COMPENSATION
$220K
AGE
64
TENURE
5.5 yrs

Mark Hill

TITLE
Independent Director
COMPENSATION
$210K
AGE
62
TENURE
5 yrs

J. Howell

TITLE
Independent Director
COMPENSATION
$210K
AGE
53
TENURE
4.5 yrs

John Larson

TITLE
Lead Independent Director
COMPENSATION
$230K
AGE
55
TENURE
4.4 yrs

Stephen Smith

TITLE
Independent Director
COMPENSATION
$200K
AGE
69
TENURE
5.5 yrs

Lynn Jolliffe

TITLE
Independent Director
COMPENSATION
$200K
AGE
66
TENURE
5 yrs

Stefan Jacoby

TITLE
Independent Director
AGE
60
Who owns this company?
Recent Insider Trading
  • No 3 month insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
X
Management checks
We assess KAR Auction Services's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. KAR Auction Services has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

KAR News

Simply Wall St News

Should KAR Auction Services, Inc. (NYSE:KAR) Be Part Of Your Dividend Portfolio?

With a 2.5% yield and a seven-year payment history, investors probably think KAR Auction Services looks like a reliable dividend stock. … NYSE:KAR Historical Dividend Yield, May 30th 2019 Payout ratios Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. As a result, we should always investigate whether a company can afford its dividend, measured as a percentage of a company's net income after tax. Looking at the data, we can see that 59% of KAR Auction Services's profits were paid out as dividends in the last 12 months. This is a healthy payout ratio, and while it does limit the amount of earnings that can be reinvested in the business, there is also some room to lift the payout ratio over time. In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. KAR Auction Services paid out a conservative 39% of its free cash flow as dividends last year. It's positive to see that KAR Auction Services's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut. Is KAR Auction Services's Balance Sheet Risky? As KAR Auction Services has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. Net debt to EBITDA is a measure of a company's total debt. Net interest cover measures the ability to meet interest payments on debt. Essentially we check that a) a company does not have too much debt, and b) that it can afford to pay the interest. … It's good to see KAR Auction Services has been growing its earnings per share at 37% a year over the past 5 years.

Simply Wall St -

Should You Worry About KAR Auction Services, Inc.'s (NYSE:KAR) CEO Pay Cheque?

See our latest analysis for KAR Auction Services How Does Jim Hallett's Compensation Compare With Similar Sized Companies? … I think that the total shareholder return of 48%, over three years, would leave most KAR Auction Services, Inc. … CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling KAR Auction Services (free visualization of insider trades).

Simply Wall St -

Estimating The Intrinsic Value Of KAR Auction Services, Inc. (NYSE:KAR)

by taking the expected future cash flows and discounting them to today's value. … We generally believe that a company's value is the present value of all of the cash it will generate in the future. … Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model

Simply Wall St -

Boasting A 22% Return On Equity, Is KAR Auction Services, Inc. (NYSE:KAR) A Top Quality Stock?

Over the last twelve months KAR Auction Services has recorded a ROE of 22%. … Another way to think of that is that for every $1 worth of equity in the company, it was able to earn $0.22. … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

What Is KAR Auction Services, Inc.'s (NYSE:KAR) Share Price Doing?

(NYSE:KAR), which is in the commercial services business, and is based in United States,. … As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock? … Let’s take a look at KAR Auction Services’s outlook and value based on the most recent financial data to see if the opportunity still exists

Simply Wall St -

Did You Miss KAR Auction Services's (NYSE:KAR) 53% Share Price Gain?

(NYSE:KAR) share price is up 53% in the last 5 years, clearly besting than the market return of around 40% (ignoring dividends). … While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. … Over half a decade, KAR Auction Services managed to grow its earnings per share at 38% a year.

Simply Wall St -

Is KAR Auction Services, Inc. (NYSE:KAR) An Attractive Dividend Stock?

Dividends play a key role in compounding returns over time and can form a large part of our portfolio return. … Historically, KAR Auction Services, Inc. … Let's dig deeper into whether KAR Auction Services should have a place in your portfolio.

Simply Wall St -

Is KAR Auction Services, Inc.'s (NYSE:KAR) CEO Overpaid Relative To Its Peers?

James Hallett became the CEO of KAR Auction Services, Inc. … First, this article will compare CEO compensation with compensation at similar sized companies. … How Does James Hallett's Compensation Compare With Similar Sized Companies?

Simply Wall St -

Investors Are Undervaluing KAR Auction Services, Inc. (NYSE:KAR) By 32.73%

by taking the expected future cash flows and discounting them to their present value. … discounted cash flows (DCF). … If you want to learn more about discounted cash flow, the basis for my calcs can be read in detail in the Simply Wall St analysis model

Simply Wall St -

What Is KAR Auction Services, Inc.'s (NYSE:KAR) Share Price Doing?

received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to $64.11 at one point, and dropping to the lows of $50.32. … A question to answer is whether KAR Auction Services's current trading price of $50.65 reflective of the actual value of the? … Let’s take a look at KAR Auction Services’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change

Simply Wall St -

KAR Company Info

Description

KAR Auction Services, Inc., together with its subsidiaries, provides used car auction and salvage auction services in the United States, Canada, Mexico, and the United Kingdom. The company operates through three segments: ADESA Auctions, IAA, and AFC. The ADESA Auctions segment offers whole car auctions and related services to the vehicle remarketing industry through online auctions and auction facilities. It also provides value-added services, such as auction related, transportation, reconditioning, inspection, title and repossession administration and remarketing, vehicle research, and analytical services, as well as data. This segment sells its products and services through vehicle manufacturers, fleet companies, rental car companies, finance companies, and others. As of December 31, 2018, this segment had a network of 75 whole car auction facilities in North America. The IAA segment offers loss claim solutions and salvage vehicle auction services that facilitate the remarketing of vehicles for a range of sellers, including insurance companies, used-vehicle dealers, rental car and fleet lease companies, auto lenders, and charitable organizations through online auctions and salvage vehicle auction sites. This segment also provides catastrophe, vehicle inspection center, and transportation and towing services. As of December 31, 2018, this segment had a network of 179 salvage auction sites in North America. It also operates 14 locations in the United Kingdom. The AFC segment offers floorplan financing, a short-term inventory-secured financing, to independent used vehicle dealers. KAR Auction Services, Inc. also provides wheel repair and hail catastrophe response services. The company was formerly known as KAR Holdings, Inc. and changed its name to KAR Auction Services, Inc. in November 2009. KAR Auction Services, Inc. was founded in 2006 and is headquartered in Carmel, Indiana.

Details
Name: KAR Auction Services, Inc.
KAR
Exchange: NYSE
Founded: 2006
$8,055,155,094
133,429,768
Website: http://www.karauctionservices.com
Address: KAR Auction Services, Inc.
13085 Hamilton Crossing Boulevard,
Carmel,
Indiana, 46032,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NYSE KAR Common Stock New York Stock Exchange US USD 11. Dec 2009
DB XKR Common Stock Deutsche Boerse AG DE EUR 11. Dec 2009
BMV KAR1 * Common Stock Bolsa Mexicana de Valores MX MXN 11. Dec 2009
NYSE KAR.WI EX DISTIBUTON New York Stock Exchange US USD 11. Jun 2019
Number of employees
Current staff
Staff numbers
16,468
KAR Auction Services employees.
Industry
Diversified Support Services
Commercial Services
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/06/19 00:19
End of day share price update: 2019/06/18 00:00
Last estimates confirmation: 2019/06/18
Last earnings filing: 2019/05/08
Last earnings reported: 2019/03/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.