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Market Cap

US$2.2b

Last Updated

2021/05/13 22:43 UTC

Data Sources

Company Financials +

Executive Summary

KAR Auction Services, Inc., together with its subsidiaries, provides used vehicle auctions and related vehicle remarketing services for the automotive industry in the United States, Europe, Canada, Mexico, and the United Kingdom. More Details


Snowflake Analysis

Fair value with moderate growth potential.


Similar Companies

Share Price & News

How has KAR Auction Services's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: KAR is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: KAR's weekly volatility (8%) has been stable over the past year.


Market Performance


7 Day Return

7.6%

KAR

-2.5%

US Commercial Services

-2.8%

US Market


1 Year Return

52.5%

KAR

49.1%

US Commercial Services

49.4%

US Market

Return vs Industry: KAR exceeded the US Commercial Services industry which returned 49.1% over the past year.

Return vs Market: KAR exceeded the US Market which returned 49.4% over the past year.


Shareholder returns

KARIndustryMarket
7 Day7.6%-2.5%-2.8%
30 Day18.9%1.0%-2.3%
90 Day-6.3%7.4%-1.3%
1 Year52.5%52.5%50.9%49.1%51.8%49.4%
3 Year-7.3%-66.9%58.3%48.0%57.5%47.6%
5 Year33.5%-55.0%125.5%101.7%121.7%97.1%

Long-Term Price Volatility Vs. Market

How volatile is KAR Auction Services's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is KAR Auction Services undervalued compared to its fair value and its price relative to the market?

39.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: KAR ($17.99) is trading below our estimate of fair value ($29.68)

Significantly Below Fair Value: KAR is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: KAR is poor value based on its PE Ratio (267.4x) compared to the US Commercial Services industry average (34.4x).

PE vs Market: KAR is poor value based on its PE Ratio (267.4x) compared to the US market (19.5x).


Price to Earnings Growth Ratio

PEG Ratio: KAR is poor value based on its PEG Ratio (13.2x)


Price to Book Ratio

PB vs Industry: KAR is good value based on its PB Ratio (1.4x) compared to the US Commercial Services industry average (2.6x).


Future Growth

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

20.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KAR's forecast earnings growth (20.3% per year) is above the savings rate (2%).

Earnings vs Market: KAR's earnings (20.3% per year) are forecast to grow faster than the US market (14.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: KAR's revenue (6.3% per year) is forecast to grow slower than the US market (9% per year).

High Growth Revenue: KAR's revenue (6.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if KAR's Return on Equity is forecast to be high in 3 years time


Past Performance

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

-34.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: KAR has a large one-off gain of $19.6M impacting its March 31 2021 financial results.

Growing Profit Margin: KAR's current net profit margins (0.4%) are lower than last year (2.9%).


Past Earnings Growth Analysis

Earnings Trend: KAR's earnings have declined by 34.2% per year over the past 5 years.

Accelerating Growth: KAR's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: KAR had negative earnings growth (-89.1%) over the past year, making it difficult to compare to the Commercial Services industry average (-0.5%).


Return on Equity

High ROE: KAR's Return on Equity (2.3%) is considered low.


Financial Health

How is KAR Auction Services's financial position?


Financial Position Analysis

Short Term Liabilities: KAR's short term assets ($3.5B) exceed its short term liabilities ($2.7B).

Long Term Liabilities: KAR's short term assets ($3.5B) exceed its long term liabilities ($2.4B).


Debt to Equity History and Analysis

Debt Level: KAR's debt to equity ratio (144.1%) is considered high.

Reducing Debt: KAR's debt to equity ratio has reduced from 238.2% to 144.1% over the past 5 years.

Debt Coverage: KAR's debt is not well covered by operating cash flow (19.3%).

Interest Coverage: KAR's interest payments on its debt are not well covered by EBIT (1.4x coverage).


Balance Sheet


Dividend

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

1.41%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate KAR's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate KAR's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if KAR's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if KAR's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: KAR is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of KAR's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.4yrs

Average management tenure


CEO

Peter Kelly (51 yo)

0.083

Tenure

US$2,427,717

Compensation

Mr. Peter J. Kelly serves as Chief Executive Officer and Director KAR Auction Services, Inc. since April 01, 2021. He served as President at KAR Auction Services, Inc. since January 7, 2019 until March 202...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD2.43M) is below average for companies of similar size in the US market ($USD3.81M).

Compensation vs Earnings: Peter's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: KAR's management team is considered experienced (2.4 years average tenure).


Board Members

Experienced Board: KAR's board of directors are not considered experienced ( 1.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

KAR Auction Services, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: KAR Auction Services, Inc.
  • Ticker: KAR
  • Exchange: NYSE
  • Founded: 2006
  • Industry: Diversified Support Services
  • Sector: Commercial Services
  • Market Cap: US$2.244b
  • Shares outstanding: 124.76m
  • Website: https://www.karglobal.com

Number of Employees


Location

  • KAR Auction Services, Inc.
  • 11299 North Illinois Street
  • Carmel
  • Indiana
  • 46032
  • United States

Listings


Biography

KAR Auction Services, Inc., together with its subsidiaries, provides used vehicle auctions and related vehicle remarketing services for the automotive industry in the United States, Europe, Canada, Mexico,...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/05/13 22:43
End of Day Share Price2021/05/13 00:00
Earnings2021/03/31
Annual Earnings2020/12/31


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.