KAR Auction Services (NYSE: KAR) is one of 20 publicly-traded companies in the “Automotive dealers & gasoline service stations” industry, but how does it compare to its rivals? We will compare KAR Auction Services to related businesses based on the strength of its earnings, risk, analyst recommendations, valuation, institutional ownership, dividends and profitability.

Earnings and Valuation

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This table compares KAR Auction Services and its rivals revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
KAR Auction Services $3.46 billion $362.00 million 21.49
KAR Auction Services Competitors $8.01 billion $220.42 million 12.16

KAR Auction Services’ rivals have higher revenue, but lower earnings than KAR Auction Services. KAR Auction Services is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Analyst Ratings

This is a summary of current ratings and target prices for KAR Auction Services and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KAR Auction Services 0 2 7 0 2.78
KAR Auction Services Competitors 115 620 667 28 2.43

KAR Auction Services currently has a consensus price target of $58.63, indicating a potential upside of 9.19%. As a group, “Automotive dealers & gasoline service stations” companies have a potential upside of 15.96%. Given KAR Auction Services’ rivals higher probable upside, analysts plainly believe KAR Auction Services has less favorable growth aspects than its rivals.

Risk & Volatility

KAR Auction Services has a beta of 1.1, suggesting that its share price is 10% more volatile than the S&P 500. Comparatively, KAR Auction Services’ rivals have a beta of 9.96, suggesting that their average share price is 896% more volatile than the S&P 500.

Insider & Institutional Ownership

98.9% of KAR Auction Services shares are held by institutional investors. Comparatively, 62.1% of shares of all “Automotive dealers & gasoline service stations” companies are held by institutional investors. 1.3% of KAR Auction Services shares are held by insiders. Comparatively, 16.5% of shares of all “Automotive dealers & gasoline service stations” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

KAR Auction Services pays an annual dividend of $1.40 per share and has a dividend yield of 2.6%. KAR Auction Services pays out 56.0% of its earnings in the form of a dividend. As a group, “Automotive dealers & gasoline service stations” companies pay a dividend yield of 1.6% and pay out 20.5% of their earnings in the form of a dividend. KAR Auction Services has increased its dividend for 5 consecutive years.

Profitability

This table compares KAR Auction Services and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KAR Auction Services 10.47% 23.61% 4.99%
KAR Auction Services Competitors 3.22% 33.52% 3.60%

Summary

KAR Auction Services beats its rivals on 8 of the 15 factors compared.

About KAR Auction Services

KAR Auction Services, Inc. is a provider of whole car auction services in North America, and salvage auction services in North America and the United Kingdom. The Company operates through three segments: ADESA, Inc. (ADESA Auctions or ADESA), Insurance Auto Auctions, Inc. (IAA) and Automotive Finance Corporation (AFC). The ADESA segment is a provider of whole car auctions and related services to the vehicle remarketing industry in North America. It serves its customer base through online auctions and auction facilities that are developed and located to draw professional sellers and buyers together, and allow the buyers to inspect and compare vehicles remotely or in person. As a provider of salvage vehicle auctions and related services, it operates as IAA in the United States and Impact Auto Auctions in Canada, and serves customer base through salvage auction locations throughout North America. The AFC segment provides floorplan financing to independent used vehicle dealers.

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