KAR Auction Services (KAR) Downgraded by Zacks Investment Research to “Sell”

Zacks Investment Research cut shares of KAR Auction Services (NYSE:KAR) from a hold rating to a sell rating in a research note issued to investors on Tuesday, Zacks.com reports.

According to Zacks, “KAR Auction Services, Inc., through its subsidiaries, operates as a used vehicle and salvage auto auction company in North America. The company operates in three segments: ADESA, IAAI, and AFC. The ADESA segment provides whole car auctions and related services to commercial fleet operators, financial institutions, rental car companies, used vehicle dealers, vehicle manufacturers and their captive finance companies, and franchised and independent used vehicle dealers. This segment also provides value-added ancillary services, such as inspections, storage, transportation, reconditioning and titling, and other administrative services. The IAAI segment offers salvage vehicle auctions and related services. The AFC segment offers short-term and inventory-secured financing, known as floorplan financing, to independent used vehicle dealers. KAR Auction Services, Inc. is headquartered in Carmel, Indiana. “

Other analysts also recently issued research reports about the company. Barrington Research reissued a buy rating and issued a $62.50 price target on shares of KAR Auction Services in a report on Friday, May 3rd. Robert W. Baird reissued a buy rating and issued a $56.00 price target on shares of KAR Auction Services in a report on Wednesday, February 20th. One equities research analyst has rated the stock with a sell rating, two have given a hold rating and four have given a buy rating to the company’s stock. The company has a consensus rating of Hold and an average target price of $61.50.

NYSE:KAR opened at $54.34 on Tuesday. The company has a debt-to-equity ratio of 2.38, a quick ratio of 1.17 and a current ratio of 1.17. KAR Auction Services has a 52 week low of $43.32 and a 52 week high of $64.55. The company has a market cap of $7.25 billion, a price-to-earnings ratio of 18.36, a PEG ratio of 1.92 and a beta of 1.14.

KAR Auction Services (NYSE:KAR) last released its earnings results on Tuesday, May 7th. The specialty retailer reported $0.70 EPS for the quarter, missing analysts’ consensus estimates of $0.77 by ($0.07). The firm had revenue of $1.05 billion for the quarter, compared to the consensus estimate of $1.01 billion. KAR Auction Services had a return on equity of 25.43% and a net margin of 8.17%. The company’s quarterly revenue was up 10.1% on a year-over-year basis. During the same period in the prior year, the business earned $0.82 EPS. On average, research analysts forecast that KAR Auction Services will post 2.94 earnings per share for the current fiscal year.

The firm also recently announced a quarterly dividend, which will be paid on Monday, June 17th. Shareholders of record on Monday, June 3rd will be paid a dividend of $0.35 per share. This represents a $1.40 annualized dividend and a yield of 2.58%. The ex-dividend date of this dividend is Friday, May 31st. KAR Auction Services’s payout ratio is currently 47.30%.

A number of institutional investors have recently made changes to their positions in the business. Marshall Wace LLP raised its stake in KAR Auction Services by 323.6% during the 1st quarter. Marshall Wace LLP now owns 402,967 shares of the specialty retailer’s stock valued at $20,676,000 after acquiring an additional 307,843 shares in the last quarter. Geode Capital Management LLC raised its stake in KAR Auction Services by 2.0% during the 1st quarter. Geode Capital Management LLC now owns 1,936,197 shares of the specialty retailer’s stock valued at $99,346,000 after acquiring an additional 37,817 shares in the last quarter. Charles Schwab Investment Management Inc. raised its stake in KAR Auction Services by 6.3% during the 1st quarter. Charles Schwab Investment Management Inc. now owns 608,064 shares of the specialty retailer’s stock valued at $31,200,000 after acquiring an additional 36,030 shares in the last quarter. Caption Management LLC acquired a new position in shares of KAR Auction Services during the 1st quarter valued at $1,027,000. Finally, AQR Capital Management LLC increased its position in shares of KAR Auction Services by 36.2% during the 1st quarter. AQR Capital Management LLC now owns 561,257 shares of the specialty retailer’s stock valued at $28,798,000 after purchasing an additional 149,093 shares during the period. 99.23% of the stock is currently owned by hedge funds and other institutional investors.

About KAR Auction Services

KAR Auction Services, Inc, together with its subsidiaries, provides used car auction and salvage auction services in the United States, Canada, Mexico, and the United Kingdom. The company operates through three segments: ADESA Auctions, IAA, and AFC. The ADESA Auctions segment offers whole car auctions and related services to the vehicle remarketing industry through online auctions and auction facilities.

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