OPENLANE (KAR) AI Stock Analysis

• Market Cap: $2.94B
• Dividend Yield: N/A
• Average Volume (3M): 882.56K
• Price to Earnings (P/E): 37.4
• Beta (1Y): 1.00
• Revenue Growth: 11.45%
• EPS Growth: 741.65%
• Country: US
• Employees: 4,080
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Dealerships
• EPS (TTM): 0.33
• Shares Outstanding: 106,303,635
• 10 Day Avg. Volume: 946,163
• 30 Day Avg. Volume: 882,560
• PEG Ratio: -0.16
• Price to Book (P/B): 1.60
• Price to Sales (P/S): 1.20
• P/FCF Ratio: 8.99
• Enterprise Value/Market Cap: 1.66
• Enterprise Value/Revenue: 2.67
• Enterprise Value/Gross Profit: 6.23
• Enterprise Value/Ebitda: 12.68
• 1Y Price Target: $31.10
• Price Target Upside: 12.27% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 63 Neutral
• Price Target: $30.00 ▲(8.30% Upside)

Kar Auction Services demonstrates strong financial recovery and robust earnings performance, which are the most significant factors driving the score. However, technical indicators suggest short-term bearish momentum, and the valuation appears high, which tempers the overall score.

Positive Factors

Revenue Growth

Sustained revenue growth indicates strong market demand and effective business strategies, enhancing long-term financial stability and market position.

Cash Flow Management

Strong cash flow management supports operational needs and investment capabilities, ensuring financial flexibility and resilience against market fluctuations.

Strategic Investments

Strategic investments enhance competitive advantages and market recognition, positioning OPENLANE for sustained growth and innovation in the automotive marketplace.

Negative Factors

Commercial Vehicle Segment Decline

A decline in commercial vehicle volumes could impact revenue diversity and growth potential, requiring strategic adjustments to mitigate long-term impacts.

Debt Management

Reliance on debt financing necessitates cautious management to maintain financial stability and avoid constraints on future growth and investment opportunities.

Tariff-Related Uncertainty

Tariff-related uncertainties pose risks to cost structures and profitability, potentially affecting strategic planning and market competitiveness in the long term.

OPENLANE Business Overview & Revenue Model

Company Description

OPENLANE, Inc., together with its subsidiaries, operates as a digital marketplace for used vehicles, which connects sellers and buyers in the United States, Canada, Continental Europe and the United Kingdom. The company operates through two segments, Marketplace and Finance. The Marketplace segment offers digital marketplace services for buying and selling used vehicles; and value-added ancillary services, including inbound and outbound transportation logistics, reconditioning, vehicle inspection and certification, titling, administrative, and collateral recovery services. Its digital marketplaces include OPENLANE platform, a mobile app enabled solutions that allows dealers to sell and source inventory. This segment sells its products and services through commercial fleet operators, financial institutions, rental car companies, new and used vehicle dealers, and vehicle manufacturers. The Finance segment offers floorplan financing, a short-term inventory-secured financing to independent vehicle dealers. It serves commercial customers, and franchise and independent dealer customers. The company was formerly known as KAR Auction Services, Inc. and changed its name to OPENLANE, Inc. in May 2023. OPENLANE, Inc. was incorporated in 2006 and is headquartered in Carmel, Indiana.

How the Company Makes Money

OPENLANE generates revenue through several key streams, primarily by charging fees for its auction services where dealers bid on and purchase vehicles. The company earns a commission on each successful sale, which forms a significant portion of its income. Additionally, OPENLANE monetizes its platform by offering subscription services for dealerships that provide enhanced features and tools for inventory management and sales analytics. Partnerships with automotive manufacturers and finance companies also contribute to its revenue, as they may provide financing options or promotional incentives that drive more transactions through the platform.

OPENLANE Financial Statement Overview

Summary

Kar Auction Services is showing signs of recovery with strong revenue growth and improved profitability metrics. The company's cash flow is robust, supporting operational needs and investment capabilities. However, the balance sheet reflects a need for cautious management of debt and equity to ensure long-term stability.

Income Statement

Kar Auction Services shows a positive trend in revenue growth with a 8.71% increase over the past year, indicating recovery. The gross profit margin is healthy at 46.54%, reflecting operational efficiency. Net profit margin improved to 6.14%, a significant turnaround from the previous year's loss. EBIT and EBITDA margins are at 10.19% and 21.06% respectively, showing improvement but still reflecting moderate operational challenges.

Balance Sheet

The debt-to-equity ratio stands at 0.21, which is manageable but suggests reliance on debt financing. Return on equity (ROE) is 8.19%, indicating moderate profitability relative to shareholder equity. The equity ratio is 39.03%, showing a relatively balanced capital structure. However, the decrease in stockholders' equity over time is a concern.

Cash Flow

The company displays strong cash flow management with a 30.73% increase in free cash flow year-over-year. The operating cash flow to net income ratio of 2.66 highlights robust cash generation from operations. Free cash flow to net income ratio is 2.18, showing effective conversion of earnings into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.83B	1.79B	1.65B	1.52B	2.25B	2.19B
Gross Profit	787.20M	832.20M	777.50M	685.10M	951.70M	902.90M
EBITDA	386.40M	274.90M	110.80M	258.00M	237.40M	325.60M
Net Income	128.30M	109.90M	-154.10M	28.60M	66.50M	500.00K
Balance Sheet
Total Assets	0.00	4.62B	4.73B	5.12B	7.42B	6.80B
Cash, Cash Equivalents and Short-Term Investments	0.00	143.00M	93.50M	225.70M	190.00M	752.10M
Total Debt	284.00M	282.90M	427.40M	573.70M	2.18B	2.22B
Total Liabilities	3.43B	3.28B	3.40B	2.99B	5.31B	4.63B
Stockholders Equity	1.37B	1.34B	1.94B	2.13B	2.10B	2.17B
Cash Flow
Free Cash Flow	265.10M	238.40M	183.40M	-473.40M	304.70M	283.00M
Operating Cash Flow	317.10M	292.80M	235.40M	-412.50M	413.20M	384.40M
Investing Cash Flow	-95.00M	-70.90M	-83.50M	2.14B	-1.22B	-326.60M
Financing Cash Flow	152.10M	-173.90M	-279.90M	-1.61B	210.40M	194.80M

OPENLANE Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 27.70
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KAR, the sentiment is Negative. The current price of 27.7 is below the 20-day moving average (MA) of 28.65, below the 50-day MA of 28.09, and above the 200-day MA of 23.04, indicating a neutral trend. The MACD of -0.01 indicates Positive momentum. The RSI at 40.55 is Neutral, neither overbought nor oversold. The STOCH value of 48.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KAR.

OPENLANE Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CARS	64 Neutral	$771.14M	20.43	8.37%	―	0.68%	67.41%
KAR	63 Neutral	$2.94B	37.39	6.27%	―	11.45%	741.65%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CANG	59 Neutral	$856.19M	6.63	-31.61%	―	348.38%	-1821.85%
ACVA	54 Neutral	$1.67B	―	-14.18%	―	30.08%	21.11%
VRM	49 Neutral	$139.82M	―	-45.88%	―	-90.19%	79.52%
UXIN	42 Neutral	$711.28M	―	260.24%	―	―	―

OPENLANE Corporate Events

OPENLANE Announces Major Stock Repurchase Agreement

On September 9, 2025, OPENLANE, Inc. announced definitive agreements to repurchase 53% of its Series A Convertible Preferred Stock, initially issued in June 2020, for approximately $559 million. This strategic move will significantly reduce the preferred shares held by Apax Partners and Periphas Capital, enhancing OPENLANE’s market position and attractiveness to investors by leveraging its asset-light, digital operating model. The transactions are expected to close between September 30 and October 20, 2025, marking a pivotal step in OPENLANE’s growth and transformation journey.