OPENLANE INC (KAR) Stock Fundamental Analysis
NYSE:KAR - New York Stock Exchange, Inc. - US48238T1097 - Common Stock - Currency: USD
KAR gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 83 industry peers in the Commercial Services & Supplies industry. Both the profitability and the financial health of KAR get a neutral evaluation. Nothing too spectacular is happening here. KAR has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
KAR had positive earnings in the past year.
KAR had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: KAR reported negative net income in multiple years.
Of the past 5 years KAR 4 years had a positive operating cash flow.
1.2 Ratios
KAR has a Return On Assets (1.65%) which is in line with its industry peers.
KAR has a Return On Equity of 3.99%. This is comparable to the rest of the industry: KAR outperforms 55.42% of its industry peers.
With a decent Return On Invested Capital value of 9.48%, KAR is doing good in the industry, outperforming 71.08% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for KAR is below the industry average of 11.67%.
The last Return On Invested Capital (9.48%) for KAR is above the 3 year average (6.94%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.65% | ||
| ROE | 3.99% | ||
| ROIC | 9.48% |
ROA(3y)0.38%
ROA(5y)0.26%
ROE(3y)0.85%
ROE(5y)0.64%
ROIC(3y)6.94%
ROIC(5y)5.07%
1.3 Margins
KAR's Profit Margin of 4.32% is fine compared to the rest of the industry. KAR outperforms 60.24% of its industry peers.
In the last couple of years the Profit Margin of KAR has declined.
With an excellent Operating Margin value of 15.50%, KAR belongs to the best of the industry, outperforming 81.93% of the companies in the same industry.
In the last couple of years the Operating Margin of KAR has grown nicely.
KAR has a Gross Margin of 46.30%. This is amongst the best in the industry. KAR outperforms 80.72% of its industry peers.
In the last couple of years the Gross Margin of KAR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.5% | ||
| PM (TTM) | 4.32% | ||
| GM | 46.3% |
OM growth 3Y20.36%
OM growth 5Y6.3%
PM growth 3Y15.59%
PM growth 5Y-11.58%
GM growth 3Y0.85%
GM growth 5Y2.13%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so KAR is destroying value.
Compared to 1 year ago, KAR has less shares outstanding
Compared to 5 years ago, KAR has less shares outstanding
The debt/assets ratio for KAR has been reduced compared to a year ago.
2.2 Solvency
KAR has an Altman-Z score of 1.45. This is a bad value and indicates that KAR is not financially healthy and even has some risk of bankruptcy.
KAR's Altman-Z score of 1.45 is on the low side compared to the rest of the industry. KAR is outperformed by 69.88% of its industry peers.
There is no outstanding debt for KAR. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.86 | ||
| Altman-Z | 1.45 |
ROIC/WACC0.73
WACC12.92%
2.3 Liquidity
KAR has a Current Ratio of 1.12. This is a normal value and indicates that KAR is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of KAR (1.12) is worse than 71.08% of its industry peers.
KAR has a Quick Ratio of 1.12. This is a normal value and indicates that KAR is financially healthy and should not expect problems in meeting its short term obligations.
KAR has a Quick ratio of 1.12. This is in the lower half of the industry: KAR underperforms 63.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 24.36% over the past year.
KAR shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -11.77% yearly.
Looking at the last year, KAR shows a quite strong growth in Revenue. The Revenue has grown by 11.67% in the last year.
KAR shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -8.46% yearly.
EPS 1Y (TTM)24.36%
EPS 3Y13.59%
EPS 5Y-11.77%
EPS Q2Q%63.16%
Revenue 1Y (TTM)11.67%
Revenue growth 3Y7.23%
Revenue growth 5Y-8.46%
Sales Q2Q%10.52%
3.2 Future
The Earnings Per Share is expected to decrease by -39.11% on average over the next years. This is quite bad
Based on estimates for the next years, KAR will show a small growth in Revenue. The Revenue will grow by 5.75% on average per year.
EPS Next Y16.45%
EPS Next 2Y15.96%
EPS Next 3Y-39.11%
EPS Next 5YN/A
Revenue Next Year5.25%
Revenue Next 2Y5.75%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 26.60, KAR can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of KAR is on the same level as its industry peers.
KAR is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.45, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 22.57, which indicates a rather expensive current valuation of KAR.
Based on the Price/Forward Earnings ratio, KAR is valued a bit cheaper than 62.65% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of KAR to the average of the S&P500 Index (21.90), we can say KAR is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.6 | ||
| Fwd PE | 22.57 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, KAR is valued cheaper than 81.93% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, KAR is valued cheaper than 89.16% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.58 | ||
| EV/EBITDA | 7.35 |
4.3 Compensation for Growth
KAR's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
KAR has a very decent profitability rating, which may justify a higher PE ratio.
KAR's earnings are expected to decrease with -39.11% in the coming years. This may justify a cheaper valuation.
PEG (NY)1.62
PEG (5Y)N/A
EPS Next 2Y15.96%
EPS Next 3Y-39.11%
5. Dividend
5.1 Amount
No dividends for KAR!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
25.8
+0.27 (+1.06%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners104.24%
Inst Owner Change2.81%
Ins Owners1.45%
Ins Owner Change5.21%
Market Cap2.77B
Analysts78.33
Price Target25.16 (-2.48%)
Short Float %4.23%
Short Ratio5.75
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0.41
Dividend Growth(5Y)-19.93%
DP56.06%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)21.97%
Min EPS beat(2)0.61%
Max EPS beat(2)43.33%
EPS beat(4)3
Avg EPS beat(4)13.36%
Min EPS beat(4)-8.31%
Max EPS beat(4)43.33%
EPS beat(8)6
Avg EPS beat(8)23.32%
EPS beat(12)8
Avg EPS beat(12)18.21%
EPS beat(16)9
Avg EPS beat(16)26.85%
Revenue beat(2)2
Avg Revenue beat(2)4.66%
Min Revenue beat(2)2.14%
Max Revenue beat(2)7.18%
Revenue beat(4)3
Avg Revenue beat(4)2.86%
Min Revenue beat(4)-0.48%
Max Revenue beat(4)7.18%
Revenue beat(8)4
Avg Revenue beat(8)0.77%
Revenue beat(12)6
Avg Revenue beat(12)0.58%
Revenue beat(16)6
Avg Revenue beat(16)-7.91%
PT rev (1m)2.78%
PT rev (3m)2.17%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.22%
EPS NY rev (1m)-0.2%
EPS NY rev (3m)6.99%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.29%
Revenue NY rev (1m)-0.27%
Revenue NY rev (3m)0.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.6 | ||
| Fwd PE | 22.57 | ||
| P/S | 1.51 | ||
| P/FCF | 10.58 | ||
| P/OCF | 8.83 | ||
| P/B | 1.4 | ||
| P/tB | 5.68 | ||
| EV/EBITDA | 7.35 |
EPS(TTM)0.97
EY3.76%
EPS(NY)1.14
Fwd EY4.43%
FCF(TTM)2.44
FCFY9.45%
OCF(TTM)2.92
OCFY11.33%
SpS17.06
BVpS18.48
TBVpS4.54
PEG (NY)1.62
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.65% | ||
| ROE | 3.99% | ||
| ROCE | 13.62% | ||
| ROIC | 9.48% | ||
| ROICexc | 10.6% | ||
| ROICexgc | 53.74% | ||
| OM | 15.5% | ||
| PM (TTM) | 4.32% | ||
| GM | 46.3% | ||
| FCFM | 14.29% |
ROA(3y)0.38%
ROA(5y)0.26%
ROE(3y)0.85%
ROE(5y)0.64%
ROIC(3y)6.94%
ROIC(5y)5.07%
ROICexc(3y)7.41%
ROICexc(5y)5.47%
ROICexgc(3y)33.24%
ROICexgc(5y)22.73%
ROCE(3y)9.97%
ROCE(5y)7.28%
ROICexcg growth 3Y127.66%
ROICexcg growth 5Y21.04%
ROICexc growth 3Y68.56%
ROICexc growth 5Y10.15%
OM growth 3Y20.36%
OM growth 5Y6.3%
PM growth 3Y15.59%
PM growth 5Y-11.58%
GM growth 3Y0.85%
GM growth 5Y2.13%
F-Score7
Asset Turnover0.38
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.86 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 55.56% | ||
| Cap/Sales | 2.84% | ||
| Interest Coverage | 2.17 | ||
| Cash Conversion | 83.1% | ||
| Profit Quality | 330.56% | ||
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.12 | ||
| Altman-Z | 1.45 |
F-Score7
WACC12.92%
ROIC/WACC0.73
Cap/Depr(3y)55.89%
Cap/Depr(5y)55.82%
Cap/Sales(3y)3.38%
Cap/Sales(5y)3.84%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)24.36%
EPS 3Y13.59%
EPS 5Y-11.77%
EPS Q2Q%63.16%
EPS Next Y16.45%
EPS Next 2Y15.96%
EPS Next 3Y-39.11%
EPS Next 5YN/A
Revenue 1Y (TTM)11.67%
Revenue growth 3Y7.23%
Revenue growth 5Y-8.46%
Sales Q2Q%10.52%
Revenue Next Year5.25%
Revenue Next 2Y5.75%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y13.78%
EBIT growth 3Y29.06%
EBIT growth 5Y-2.69%
EBIT Next Year14.29%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y181.86%
FCF growth 3Y-13.2%
FCF growth 5Y-8.92%
OCF growth 1Y220.51%
OCF growth 3Y-12.08%
OCF growth 5Y-11.67%