ACV Auctions (ACVA) AI Stock Analysis

• Market Cap: $1.34B
• Dividend Yield: N/A
• Average Volume (3M): 4.01M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.63
• Revenue Growth: 23.40%
• EPS Growth: 8.46%
• Country: US
• Employees: 2,900
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Dealerships
• EPS (TTM): 0.07
• Shares Outstanding: 172,171,220
• 10 Day Avg. Volume: 2,892,276
• 30 Day Avg. Volume: 4,010,764
• PEG Ratio: -21.00
• Price to Book (P/B): 8.09
• Price to Sales (P/S): 5.59
• P/FCF Ratio: 58.51
• Enterprise Value/Market Cap: 1.19
• Enterprise Value/Revenue: 2.18
• Enterprise Value/Gross Profit: 3.74
• Enterprise Value/Ebitda: -79.39
• 1Y Price Target: $11.32
• Price Target Upside: 45.13% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10
• EPS Forecast (FY): 0.17
• Revenue Forecast (FY): $758.34M

• Rating: 56 Neutral
• Price Target: $8.00 ▲(2.56% Upside)

ACV Auctions is on a growth trajectory with strong revenue performance and strategic expansions. However, profitability challenges and a negative P/E ratio weigh on its valuation. The technical analysis suggests potential stability, but longer-term trends are concerning. The recent corporate event positively impacts funding capacity, supporting future growth.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for ACV's platform, enhancing its market position and supporting long-term business expansion.

Geographic Expansion

Expansion into new regions boosts ACV's market reach, diversifying revenue streams and reducing dependency on existing markets.

Enhanced Funding Capacity

Increased funding capacity and reduced borrowing costs enhance financial flexibility, supporting future growth and operational stability.

Negative Factors

Profitability Challenges

Ongoing profitability issues may hinder ACV's ability to reinvest in growth initiatives and maintain competitive advantages over time.

Increased Arbitration Costs

Rising arbitration costs can pressure margins, affecting overall profitability and potentially leading to higher operational expenses.

Market Conditions Affecting Guidance

Adverse market conditions may limit revenue growth and profitability, challenging ACV's ability to meet financial targets and sustain growth.

ACV Auctions Business Overview & Revenue Model

Company Description

ACV Auctions Inc. operates a digital marketplace that connects buyers and sellers for the online auction of wholesale vehicles. It also provides data services that offer insights into the condition and value of used vehicles, as well as offers customer financing services. ACV Auctions Inc. was incorporated in 2014 and is headquartered in Buffalo, New York.

How the Company Makes Money

ACV Auctions generates revenue primarily through transaction fees charged to dealers on each vehicle sold through its platform. The company earns a percentage of the sale price as a commission, which serves as a key revenue stream. Additionally, ACV may offer subscription-based services or premium features that provide dealers with enhanced insights or tools for managing their transactions. Partnerships with automotive dealers and financing institutions further bolster its revenue by expanding the customer base and facilitating seamless transactions. The company also benefits from ancillary services, such as inspection fees, that contribute to its overall earnings.

ACV Auctions Financial Statement Overview

Summary

ACV Auctions demonstrates growth in revenue and maintains a solid gross profit margin, but struggles with profitability and cash flow sustainability. The balance sheet shows moderate leverage, which is a positive, but the negative return on equity is concerning. Overall, the company is on a growth trajectory but faces challenges in achieving profitability and sustaining cash flow growth.

Income Statement

ACV Auctions shows a modest revenue growth rate of 3.99% TTM, indicating some positive momentum. However, the company struggles with profitability, evidenced by a negative net profit margin of -9.09% and a negative EBIT margin of -7.99% TTM. The gross profit margin remains relatively healthy at 57.18% TTM, suggesting efficient cost management at the gross level. Overall, the income statement reflects growth but also highlights significant profitability challenges.

Balance Sheet

The company's debt-to-equity ratio of 0.42 TTM indicates moderate leverage, which is manageable. However, the return on equity is negative at -14.41% TTM, reflecting ongoing losses. The equity ratio stands at 37.25% TTM, suggesting a reasonable level of equity financing. The balance sheet shows stability in terms of leverage but highlights concerns regarding profitability and returns.

Cash Flow

ACV Auctions has a strong free cash flow to net income ratio of 1.02 TTM, indicating effective cash generation relative to net income. However, the free cash flow growth rate is negative at -27.38% TTM, signaling potential cash flow challenges. The operating cash flow to net income ratio of 0.21 TTM suggests that operating cash flows are covering net income, albeit at a modest level. The cash flow statement reflects adequate cash generation but also points to potential risks in sustaining cash flow growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	735.48M	637.16M	481.23M	421.53M	358.44M	208.36M
Gross Profit	428.81M	388.95M	236.78M	184.88M	153.68M	95.31M
EBITDA	-20.18M	-37.96M	-53.88M	-89.75M	-67.92M	-32.65M
Net Income	-72.72M	-79.70M	-75.26M	-102.19M	-78.18M	-41.02M
Balance Sheet
Total Assets	1.17B	984.15M	922.92M	914.92M	982.96M	404.55M
Cash, Cash Equivalents and Short-Term Investments	316.02M	270.10M	411.33M	495.98M	579.08M	233.72M
Total Debt	220.00M	123.00M	115.00M	76.67M	3.85M	6.90M
Total Liabilities	732.05M	544.14M	466.40M	429.20M	426.86M	544.24M
Stockholders Equity	434.45M	440.00M	456.53M	485.72M	556.10M	-139.69M
Cash Flow
Free Cash Flow	63.69M	60.86M	-46.05M	-98.57M	71.26M	1.48M
Operating Cash Flow	87.37M	65.40M	-17.89M	-75.17M	85.29M	10.37M
Investing Cash Flow	-152.95M	-15.86M	-110.97M	-282.98M	-129.27M	-19.67M
Financing Cash Flow	78.27M	-7.87M	30.63M	72.93M	376.25M	60.76M

ACV Auctions Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.80
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACVA, the sentiment is Positive. The current price of 7.8 is below the 20-day moving average (MA) of 7.88, below the 50-day MA of 7.85, and below the 200-day MA of 12.44, indicating a neutral trend. The MACD of 0.09 indicates Negative momentum. The RSI at 56.85 is Neutral, neither overbought nor oversold. The STOCH value of 45.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ACVA.

ACV Auctions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KAR	70 Outperform	$3.25B	34.85	6.99%	―	12.29%	347.02%
CARS	68 Neutral	$771.59M	27.95	6.11%	―	0.20%	-20.57%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
ACVA	56 Neutral	$1.34B	―	-16.33%	―	23.40%	8.46%
CANG	56 Neutral	$551.80M	-0.51	-25.80%	―	1434.51%	-1207.73%
UXIN	48 Neutral	$703.04M	-20.38	―	―	―	―
VRM	38 Underperform	$129.05M	-1.29	-52.02%	―	-81.31%	87.13%

ACV Auctions Corporate Events

ACV Auctions Expands and Extends Revolving Credit Facility

On December 12, 2025, ACV Capital Funding II LLC, an affiliate of ACV Auctions, amended its Revolving Credit and Security Agreement to expand its revolving credit facility from $125 million to $200 million, extend the scheduled commitment termination date from June 20, 2026 to December 10, 2027, and adjust certain eligibility and concentration limit definitions for dealers and vehicles. In connection with this amendment, the applicable margin used to calculate the interest rate on loans under the facility was reduced by 0.25%, collectively enhancing ACV Capital II’s funding capacity, lowering its borrowing costs, and potentially strengthening ACV Auctions’ ability to finance dealer inventory and support growth in its digital wholesale marketplace.