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TrueCar Reports In-Line Q2 Earnings, Lags Revenue Estimates

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TrueCar, Inc. (TRUE - Free Report) reported second-quarter 2018 adjusted earnings of $0.03 per share, inline with the Zacks Consensus Estimate.

Revenues of $87.9 million missed the Zacks Consensus Estimate by 0.32% and were within the company’s guided range of $87-$89 million. However, revenues were up 7.4% year over year.

Following second-quarter results on Aug 10, its share price was down 3%. We observe that the stock has lost 22.2% against its industry’s growth of 4% in the past year.

 

Operating Metrics

Average monthly unique visitors were 7.8 million in the second quarter, up 8% year over year.

Units were 250,269 in the second quarter, up 3% from the year-ago quarter.

Monetization was $332 in the second quarter versus $319 in the year-ago quarter.

As of Jun 30, 2018, franchise dealer count was 12,368, up 1.3% year over year, while independent dealer count was up 5.3% year over year to 3,166.

Operating Results

Per the press release, gross margin was 91.2%, down 10 basis points from the year-ago quarter. The decrease was due to an unfavorable mix.

Operating expenses of $81.2 million increased 6.2% year over year. As a percentage of sales, technology and development expenses increased, while sales and marketing, as well as general &administrative costs decreased.

Adjusted EBITDA margin was 9.9%, up from 9.0% in the year-ago quarter.

Balance Sheet & Cash Flow

Total cash, cash equivalents and Marketable securities were $198.5 million in the second quarter versus $195.8 million in the last reported quarter.

Accounts receivable were $42.8 million in the quarter versus $37.3 million in the last reported quarter.

Guidance

For the third quarter, TrueCar expects revenues in the range of $93-$95 million. The Zacks Consensus Estimate is pegged at $98.8 million. Adjusted EBITDA is expected in the range of $10-$11 million, while units are anticipated within 274-279k.

For full-year 2018, TrueCar expects revenues in the range of $360-$365 million. The Zacks Consensus Estimate is pegged at $360.8 million. Adjusted EBITDA is expected in the range of $36-$40 million, while units are anticipated within 1,030-1,040k.

TrueCar, Inc. Price, Consensus and EPS Surprise

 

TrueCar, Inc. Price, Consensus and EPS Surprise | TrueCar, Inc. Quote

Zacks Rank and Stocks to Consider

Currently, TrueCar carries a Zacks Rank #2 (Buy). Other top-ranked stocks in the same industry include Expedia Group, Inc. (EXPE - Free Report) , Infineon Technologies AG (IFNNY - Free Report) and Rambus Inc. (RMBS - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Long-term earnings growth for Expedia, Infineon Technologies and Rambus is currently projected to be 16.1%, 7.5% and 10%, respectively.

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