Head-To-Head Survey: TrueCar (TRUE) & Autohome (NYSE:ATHM)

TrueCar (NASDAQ: TRUE) and Autohome (NYSE:ATHM) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.

Profitability

This table compares TrueCar and Autohome’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TrueCar -9.86% -11.00% -8.49%
Autohome 23.17% 22.64% 15.55%

Earnings & Valuation

This table compares TrueCar and Autohome’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
TrueCar $306.80 million 5.47 -$16.51 million ($0.35) -48.69
Autohome $958.29 million 7.91 $233.45 million $1.87 34.93

Autohome has higher revenue and earnings than TrueCar. TrueCar is trading at a lower price-to-earnings ratio than Autohome, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

91.7% of TrueCar shares are held by institutional investors. Comparatively, 40.2% of Autohome shares are held by institutional investors. 15.5% of TrueCar shares are held by company insiders. Comparatively, 5.7% of Autohome shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility & Risk

TrueCar has a beta of 3, meaning that its share price is 200% more volatile than the S&P 500. Comparatively, Autohome has a beta of 2.19, meaning that its share price is 119% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for TrueCar and Autohome, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TrueCar 1 2 7 0 2.60
Autohome 0 0 4 0 3.00

TrueCar currently has a consensus price target of $18.50, indicating a potential upside of 8.57%. Autohome has a consensus price target of $58.33, indicating a potential downside of 10.70%. Given TrueCar’s higher possible upside, equities analysts clearly believe TrueCar is more favorable than Autohome.

Summary

Autohome beats TrueCar on 8 of the 13 factors compared between the two stocks.

About TrueCar

TrueCar, Inc. is an Internet-based information, technology, and communication services company. The Company has a data-driven online platform, which features market data and analytics. The Company-branded platform is available on its TrueCar Website and mobile applications. It customizes and operates its platform on a co-branded basis for its affinity group marketing partners, including financial institutions, membership-based organizations, and employee buying programs for a range of enterprises. The Company enables users to obtain market-based pricing data on new and used cars, and to connect with its network of TrueCar Certified Dealers. Its network of over 13,000 TrueCar Certified Dealers consists primarily of new car franchises, as well as independent dealers selling used vehicles. Its subsidiary, ALG, Inc., provides forecasts and consulting services regarding determination of the residual value of an automobile at given future points in time.

About Autohome

Autohome Inc. is an online destination for automobile consumers in China. The Company is engaged in the provision of online advertising and dealer subscription services in the People’s Republic of China (PRC). The Company, through its Websites, autohome.com.cn and che168.com, and mobile applications, delivers content to automobile buyers and owners. These services are offered to automakers and dealers, and advertising agencies that represent automakers and dealers in the automobile industry. The Company’s autohome.com.cn targets automobile consumers with a focus on new automobiles. The Company’s professionally produced content is created by editorial team and includes automobile-related articles and reviews, pricing trends in various local markets, and photos and video clips. Its database also includes new and used automobile listings and promotional information. Its dealer subscription services allow dealers to market their inventory and services through its Websites.




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