CAR Group shares lift on analyst backing after reporting profit growth
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The news: Shares in online car marketplace operator CAR Group are posting big gains after the company reported a 10% rise in full-year profit on Monday and analysts widely backed the stock.
The numbers: At 11:27am AEST shares in CAR Group rallied 4.5% to $38.87, despite closing roughly flat on Monday.
Morgan Stanley analysts have marginally lifted their target price from $42.50 to $43 and retained an overweight rating, while UBS analysts marginally lifted their target price from $46 to $46.50 and retained a buy rating.
The context: Morgan Stanley analysts said CAR Group “demonstrates best-practice” in innovating new IP and products in one market and “is one of the reasons CAR has delivered sustained strong international revenue and EBITDA growth, ahead of the market’s expectations”.
“It’s early days but we see a similar opportunity in CAR’s emerging C2C payments product, customer feedback is very positive,” the Morgan Stanley research note reads.
UBS also flagged in a research note that CAR “delivered another credible result despite tough operating conditions, with key positives a resilient US performance and strong [Latin America] momentum”.
In particular, Citi analysts said that while FY26 guidance for net profit after tax is 1% below consensus, according to Visible Alpha, guidance for US-focused Trader Interactive (TI) is stronger than expected. FY25 revenue for TI was also stronger than expected.
The sources: Morgan Stanley research, UBS research, Citi research
