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TrueCar (TRUE) Q1 Earnings: Is a Surprise in the Cards?
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TrueCar, Inc. (TRUE - Free Report) is expected to report first-quarter 2017 results on May 4. Last quarter, the company posted a positive earnings surprise of 38.46%.
In fact, TrueCar’s surprise history has been quite impressive. It surpassed estimates in each of the last four quarters with an average positive surprise of 29.64. Year to date, the stock has outperformed the Zacks Internet - Services industry. It gained 41.3% compared with the industry’s gain of 14.7%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
TrueCar's revenues improved year over year in the last two quarters while its losses narrowed. The company’s fourth-quarter 2016 revenues increased 17% from the year-ago quarter. Moreover, non-GAAP net loss per share narrowed to a penny from 6 cents reported in the year-ago quarter.
TrueCar has been focused on turning its business around by making refinements in its marketplace so as to meet the demand of car buyers, dealers and original equipment manufacturers (OEMs). The company is working on a new operating plan that incorporates this priority and focuses on making TrueCar a more balanced and efficient company that creates value for both car dealers and customers.
On the dealer side, the company made progress with its dealer pledge (reforming, product, advertising and business practices), which helped attract high quality dealers to its platform.
On the product side, TrueCar has made research driven product changes to its price report page and registration flow in order to bring more clarity to its marketing message. This has been attracting more real car buyers to TrueCar’s platform, thus increasing conversion rate. This is expected to have an impact on first-quarter results.
TrueCar is now offers vehicle specific pricing information. On the technology side, TrueCar is working on improving functional alignment and coordination across its business. All these improvements are expected to drive growth in the first quarter.
For the first quarter, TrueCar expects revenues between $71 million and $73 million and adjusted EBITDA in a range of $4 million to $5 million. Additionally, it expects units to remain in a range of 205,000 to 210,000.
Our proven model does not conclusively show that TrueCar is likely to beat estimates this quarter as it does not have the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at a loss of 11 cents per share. Hence, the difference is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: TrueCar currently has a Zacks Rank #3 which when combined with a 0.00% ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks That Warrant a Look
Here are some stocks, which you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Mettler-Toledo International, Inc. (MTD - Free Report) with an Earnings ESP of +0.33% and a Zacks Rank #2.
The Priceline Group Inc. with an Earnings ESP of +2.06% and a Zacks Rank #3.
5 Trades Could Profit ""Big-League"" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure.
Image: Bigstock
TrueCar (TRUE) Q1 Earnings: Is a Surprise in the Cards?
TrueCar, Inc. (TRUE - Free Report) is expected to report first-quarter 2017 results on May 4. Last quarter, the company posted a positive earnings surprise of 38.46%.
In fact, TrueCar’s surprise history has been quite impressive. It surpassed estimates in each of the last four quarters with an average positive surprise of 29.64. Year to date, the stock has outperformed the Zacks Internet - Services industry. It gained 41.3% compared with the industry’s gain of 14.7%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
TrueCar's revenues improved year over year in the last two quarters while its losses narrowed. The company’s fourth-quarter 2016 revenues increased 17% from the year-ago quarter. Moreover, non-GAAP net loss per share narrowed to a penny from 6 cents reported in the year-ago quarter.
TrueCar has been focused on turning its business around by making refinements in its marketplace so as to meet the demand of car buyers, dealers and original equipment manufacturers (OEMs). The company is working on a new operating plan that incorporates this priority and focuses on making TrueCar a more balanced and efficient company that creates value for both car dealers and customers.
On the dealer side, the company made progress with its dealer pledge (reforming, product, advertising and business practices), which helped attract high quality dealers to its platform.
On the product side, TrueCar has made research driven product changes to its price report page and registration flow in order to bring more clarity to its marketing message. This has been attracting more real car buyers to TrueCar’s platform, thus increasing conversion rate. This is expected to have an impact on first-quarter results.
TrueCar is now offers vehicle specific pricing information. On the technology side, TrueCar is working on improving functional alignment and coordination across its business. All these improvements are expected to drive growth in the first quarter.
For the first quarter, TrueCar expects revenues between $71 million and $73 million and adjusted EBITDA in a range of $4 million to $5 million. Additionally, it expects units to remain in a range of 205,000 to 210,000.
TrueCar, Inc. Price and EPS Surprise
TrueCar, Inc. Price and EPS Surprise | TrueCar, Inc. Quote
Earnings Whispers
Our proven model does not conclusively show that TrueCar is likely to beat estimates this quarter as it does not have the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at a loss of 11 cents per share. Hence, the difference is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: TrueCar currently has a Zacks Rank #3 which when combined with a 0.00% ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks That Warrant a Look
Here are some stocks, which you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
DragonWave with an Earnings ESP of +8.82% and a Zacks Rank #2.You can see the complete list of today’s Zacks #1 Rank stocks here.
Mettler-Toledo International, Inc. (MTD - Free Report) with an Earnings ESP of +0.33% and a Zacks Rank #2.
The Priceline Group Inc. with an Earnings ESP of +2.06% and a Zacks Rank #3.
5 Trades Could Profit ""Big-League"" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure.
See these buy recommendations now >>