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Cango Inc (CANG)
:CANG
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Cango
(NYSE:CANG)
Rating:57Neutral
Price Target:
$5.00
▲(1.83% Upside)
Cango (CANG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$509.60M
Dividend YieldN/A
Average Volume (3M)541.42K
Price to Earnings (P/E)6.6
Beta (1Y)0.42
Revenue Growth40.31%
EPS Growth-204.86%
CountryUS
Employees217
SectorConsumer Cyclical
Sector Strength80
IndustryAuto - Dealerships
Share Statistics
EPS (TTM)-0.28
Shares Outstanding172,265,230
10 Day Avg. Volume481,814
30 Day Avg. Volume541,421
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap-0.07
Enterprise Value/Revenue-0.05
Enterprise Value/Gross Profit-0.16
Enterprise Value/Ebitda-0.15
Forecast
1Y Price Target
$6.50Price Target Upside32.38% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Cango Business Overview & Revenue Model
Company DescriptionCango Inc. operates an automotive transaction service platform that connects dealers, original equipment manufacturer, financial institutions, car buyers, and other industry participants in the People's Republic of China. The company offers automobile trading solutions, including car sourcing, logistics, and warehousing support for dealers; and facilitation of car purchases for car buyers. It also facilitates automotive financing services that include facilitating financing transactions from financial institutions to car buyers; and after-market services to car buyers, which includes facilitating the sale of insurance policies from insurance brokers or companies. The company was founded in 2010 and is headquartered in Shanghai, the People's Republic of China.
How the Company Makes MoneyCango generates revenue through multiple streams. The primary revenue source comes from facilitating auto loans and financing products, where the company earns commissions from financial institutions upon successful loan approvals. Additionally, Cango offers after-market services, including extended warranties and insurance products, which provide further commission-based income. The company has also built partnerships with various automotive dealerships and financial service providers, enhancing its service offerings and expanding its customer reach. Furthermore, strategic collaborations with online platforms and technology partners contribute to its earnings by enabling a seamless transaction experience for users.
Cango Earnings Call Summary
Earnings Call Date:May 14, 2025
(Q1-2025)
| % Change Since: |
Next Earnings Date:Sep 01, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. While there were notable achievements in revenue growth and Bitcoin mining efficiency, significant challenges such as operating and net losses, decreased automotive trading revenue, and high electricity costs weigh heavily. The sentiment is balanced between positive expansion and efficiency highlights and negative financial outcomes and operational challenges.Q1-2025 Updates
Positive Updates
Significant Revenue Growth
Total revenue in the first quarter of 2025 was RMB 1.1 billion, significantly up from RMB 64.4 million in the same period of 2024, primarily driven by the Bitcoin mining business.
Strong Cash Position
As of March 31, 2025, Cango maintained a strong cash position with total cash, cash equivalents, and short-term investments amounting to USD 347 million.
Bitcoin Mining Efficiency
Cango mined a total of 1,541 Bitcoin in Q1 2025, with an average monthly effective hash rate consistently exceeding 30 exahashes per second and an efficiency rate as high as 94%.
Expansion Plans in Bitcoin Mining
The delivery of an additional 18 exahashes per second of computing power is progressing and expected to be completed by July 31, increasing total hash rate capacity to 50.
Improvement in Loan Quality
Credit risk exposure not covered by full bad debt allowance or full risk assurance liabilities declined to RMB 760 million, down 30% from RMB 1.08 billion as of December 31, 2024.
Negative Updates
Operating Loss
Operating loss stood at USD 21.42 million, primarily due to a decline in Bitcoin prices towards the end of March.
Net Loss
Net loss in the first quarter of 2025 was RMB 207.3 million.
Decrease in Automotive Trading Revenue
Revenue from automotive trading-related income in Q1 2025 was RMB 7.6 million, compared with RMB 64.4 million in the same period of 2024.
Challenges in Mining Efficiency
April saw a 11.3% decrease in mined Bitcoin compared to March, due to the second largest monthly increase in global network hash rate and an 8% rise in mining difficulty.
High Electricity Costs
The company is experiencing relatively high electricity costs due to the premium associated with power procurement under the hosted operation model.
Company Guidance
During Cango Inc.'s first quarter 2025 earnings call, the company reported a total revenue of USD 145 million, with USD 144 million generated from its Bitcoin mining operations. Cango mined 1,541 Bitcoins in Q1, contributing to a total holding of 2,944.8 Bitcoins by the end of April, positioning it as the 14th largest holder among publicly listed companies. Despite achieving a gross profit of USD 13.61 million, the company faced an operating loss of USD 21.42 million due to a decrease in Bitcoin prices. Cango maintained a strong cash position with USD 347 million in cash, cash equivalents, and short-term investments. The company's mining efficiency was high, with an average monthly effective hash rate exceeding 30 exahashes per second and a coin yield of 16.6 Bitcoins per Eh/S, ranking among the top three publicly listed mining companies. Additionally, Cango's energy efficiency was noted at 21.6 joules per tera hash for the quarter. The company plans to expand its mining capacity to 50 exahashes per second by the end of July and continues to focus on improving its operational metrics and exploring M&A opportunities for growth.Cango Financial Statement Overview
Summary
Cango's financial performance shows improved profitability and margins, with a strong balance sheet characterized by low leverage. However, revenue volatility and cash flow inconsistencies present challenges, impacting the overall score.Income Statement
Cango's income statement indicates a volatile revenue trend with a significant drop in 2023 from 2022, followed by a recovery in 2024. The gross profit margin in 2024 is impressive at 55.30%, showing strong cost control. However, the net profit margin has swung from negative to a robust 37.24% in 2024, indicating improved profitability. EBIT and EBITDA margins have also improved significantly, highlighting enhanced operational efficiency. Despite these improvements, the revenue growth rate is concerning due to the high volatility, impacting the overall score.65
Positive
Balance Sheet
The balance sheet reflects a strong equity position with a debt-to-equity ratio of 0.04 in 2024, indicating low leverage. The equity ratio is 68.45%, suggesting a solid capital structure with ample equity buffer. Return on equity has improved dramatically to 7.34% in 2024 from the previous negative figures, showing effective use of shareholder capital. Despite these strengths, the company experienced fluctuations in total assets and liabilities, which may pose potential risks.70
Positive
Cash Flow
Cango's cash flow statement shows inconsistent free cash flow, with a substantial positive free cash flow in 2023 but zero in 2024, raising concerns about sustainable cash generation. The operating cash flow to net income ratio is not calculable due to zero operating cash flow in 2024, indicating potential challenges in translating profits into cash. The historical pattern of negative operating cash flow raises further concerns about cash management.55
Neutral
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 804.49M | 1.70B | 1.98B | 3.92B | 2.05B |
| Gross Profit | 444.97M | 190.06M | 150.36M | 963.71M | 954.31M |
| EBITDA | 182.91M | 78.33M | -947.14M | 35.30M | 439.40M |
| Net Income | 299.82M | -37.87M | -1.11B | -8.54M | 3.37B |
Balance Sheet | |||||
| Total Assets | 5.97B | 4.65B | 7.02B | 10.95B | 12.15B |
| Cash, Cash Equivalents and Short-Term Investments | 2.52B | 1.66B | 2.32B | 4.03B | 5.77B |
| Total Debt | 169.54M | 90.54M | 1.08B | 2.00B | 2.56B |
| Total Liabilities | 1.88B | 831.63M | 2.69B | 3.96B | 3.77B |
| Stockholders Equity | 4.09B | 3.82B | 4.32B | 6.99B | 8.38B |
Cash Flow | |||||
| Free Cash Flow | -1.24B | 1.02B | -572.01M | -423.31M | -626.97M |
| Operating Cash Flow | -310.20M | 1.03B | -567.39M | -404.39M | -621.61M |
| Investing Cash Flow | -1.25B | 2.12B | 1.96B | 2.66B | -493.56M |
| Financing Cash Flow | -127.38M | -1.19B | -2.99B | -1.95B | -380.82M |
Cango Technical Analysis
Positive
4.91
Price Trends
4.88
Negative
4.60
Positive
4.46
Positive
Market Momentum
-0.01
Negative
50.05
Neutral
62.50
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CANG, the sentiment is Positive. The current price of 4.91 is above the 20-day moving average (MA) of 4.82, above the 50-day MA of 4.88, and above the 200-day MA of 4.46, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 50.05 is Neutral, neither overbought nor oversold. The STOCH value of 62.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CANG.
Cango Risk Analysis
Cango disclosed 95 risk factors in its most recent earnings report. Cango reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Cango Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $804.94M | 21.33 | 8.37% | ― | 0.68% | 67.41% | |
67 Neutral | $381.60M | 21.99 | 3.45% | ― | -0.21% | ― | |
61 Neutral | $17.75B | 12.56 | -5.49% | 3.02% | 1.43% | -14.12% | |
57 Neutral | $509.60M | 6.63 | 0.12% | ― | 40.31% | -204.86% | |
46 Neutral | $241.21M | ― | -167.38% | ― | ― | ― | |
41 Neutral | $806.12M | ― | 260.24% | ― | ― | ― | |
38 Underperform | $7.83M | ― | -86.66% | ― | -100.00% | 85.07% |
* Consumer Cyclical Sector Average
Performance Comparison
CANG
Cango
4.87
3.15
183.14%
CRMT
America's Car-Mart
46.71
-14.55
-23.75%
CARS
Cars
13.17
-4.33
-24.74%
KXIN
Kaixin Auto Holdings
0.74
-3.77
-83.59%
UXIN
Uxin
3.71
2.18
142.48%
SDA
SunCar Technology Group
2.49
-7.69
-75.54%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.