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OPENLANE (KAR)
NYSE:KAR
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OPENLANE (KAR) AI Stock Analysis

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KAR

OPENLANE

(NYSE:KAR)

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Outperform 70 (OpenAI - 4o)
Rating:70Outperform
Price Target:
$29.00
▲(7.45% Upside)
OPENLANE's strong financial performance and positive earnings call are significant strengths, indicating robust growth and profitability. However, technical indicators suggest bearish momentum, and the high P/E ratio points to overvaluation concerns. The absence of a dividend yield further impacts the valuation score.
Positive Factors
Revenue Growth
Consistent revenue growth highlights the company's ability to expand its market presence and enhance its service offerings, supporting long-term business sustainability.
Strategic Investments
Strategic investments in technology and personnel enhance competitive positioning and operational efficiency, driving future growth and market leadership.
Balance Sheet Health
A strong balance sheet with low leverage provides financial flexibility and reduces risk, enabling the company to invest in growth opportunities and weather economic downturns.
Negative Factors
Commercial Vehicle Segment Challenges
Declining volumes in the commercial vehicle segment may indicate challenges in market demand or competitive pressures, potentially impacting future revenue streams.
Tariff-Related Uncertainty
Tariff-related uncertainties could affect supply chains and cost structures, posing risks to profitability and operational stability in the medium term.
Seasonality and Market Uncertainty
Seasonal fluctuations and market uncertainties may lead to uneven financial performance, complicating strategic planning and forecasting.

OPENLANE (KAR) vs. SPDR S&P 500 ETF (SPY)

OPENLANE Business Overview & Revenue Model

Company DescriptionOPENLANE, 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 MoneyOPENLANE 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 Earnings Call Summary

Earnings Call Date:Aug 06, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Positive
OPENLANE's earnings call showcased a strong performance with robust growth in dealer-to-dealer volumes, increased profitability, and successful strategic initiatives. Despite challenges in the commercial vehicle segment and external uncertainties like tariffs and seasonality, the company's positive outlook and raised guidance indicate solid momentum.
Q2-2025 Updates
Positive Updates
Strong Overall Growth and Profitability
OPENLANE reported a 9% increase in revenue, $87 million in adjusted EBITDA representing 21% growth, and strong cash flow generation. EBITDA margins expanded by 190 basis points to 18%.
Significant Dealer-to-Dealer Volume Growth
Dealer-to-dealer volumes increased by 21%, marking the third consecutive quarter of double-digit volume increases. Auction fee revenue grew by 24% and marketplace adjusted EBITDA increased by 36%.
Successful Strategic Investments
The growth was attributed to strategic investments in people, technology, and go-to-market approaches, reflecting increasing market recognition of the OPENLANE brand.
Raising 2025 Guidance
Based on strong performance, OPENLANE revised its full-year adjusted EBITDA guidance from $290-$310 million to $310-$320 million and operating adjusted EPS from $0.90-$1.00 to $1.12-$1.17.
Finance Segment Performance
The Finance segment grew average managed receivables and increased adjusted EBITDA by 9% while maintaining a low loan loss rate of 1.5%.
Negative Updates
Decline in Commercial Vehicle Volumes
Commercial vehicle volumes were down 9% as expected, though there is anticipation of volume recovery beginning in 2026.
Tariff-Related Uncertainty
Concerns remain about potential headwinds from tariffs impacting total new vehicle retail sales in the second half of the year.
Q4 Seasonality and Uncertainty
The guidance for the second half reflects expectations of some deceleration in growth due to market uncertainties and Q4 seasonality.
Company Guidance
During the second quarter of 2025, OPENLANE reported significant growth and profitability, with a 9% increase in revenue and a 21% rise in adjusted EBITDA, which amounted to $87 million. The company also saw a 24% increase in auction fee revenue and a 36% boost in marketplace adjusted EBITDA. In its Finance segment, OPENLANE grew average managed receivables, maintained a loan loss rate of 1.5%, and increased adjusted EBITDA by 9%. The gross merchandise value rose to $7.5 billion, driven by a 21% growth in dealer-to-dealer volumes and a 32% increase in dealer GMV. OPENLANE reported a 12% adjusted EBITDA margin for the Marketplace segment and sustained high cash flow conversion, achieving a consolidated adjusted free cash flow of $87 million for the quarter. Based on these strong results, the company raised its 2025 guidance, projecting adjusted EBITDA in the range of $310 million to $320 million and operating adjusted EPS between $1.12 and $1.17.

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
75
Positive
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
80
Positive
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
70
Positive
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.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.88B1.79B1.65B1.52B2.25B2.19B
Gross Profit739.30M832.20M777.50M685.10M951.70M902.90M
EBITDA259.20M274.90M110.80M258.00M237.40M325.60M
Net Income151.00M109.90M-154.10M28.60M66.50M500.00K
Balance Sheet
Total Assets4.64B4.62B4.73B5.12B7.42B6.80B
Cash, Cash Equivalents and Short-Term Investments119.10M143.00M93.50M225.70M190.00M752.10M
Total Debt56.80M282.90M427.40M573.70M2.18B2.22B
Total Liabilities3.22B3.28B3.40B2.99B5.31B4.63B
Stockholders Equity1.42B1.34B1.94B2.13B2.10B2.17B
Cash Flow
Free Cash Flow298.40M238.40M183.40M-473.40M304.70M283.00M
Operating Cash Flow348.00M292.80M235.40M-412.50M413.20M384.40M
Investing Cash Flow-106.20M-70.90M-83.50M2.14B-1.22B-326.60M
Financing Cash Flow-226.30M-173.90M-279.90M-1.61B210.40M194.80M

OPENLANE Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price26.99
Price Trends
50DMA
28.07
Negative
100DMA
26.56
Positive
200DMA
23.56
Positive
Market Momentum
MACD
-0.35
Negative
RSI
46.49
Neutral
STOCH
71.61
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KAR, the sentiment is Neutral. The current price of 26.99 is below the 20-day moving average (MA) of 27.01, below the 50-day MA of 28.07, and above the 200-day MA of 23.56, indicating a neutral trend. The MACD of -0.35 indicates Negative momentum. The RSI at 46.49 is Neutral, neither overbought nor oversold. The STOCH value of 71.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for KAR.

OPENLANE Risk Analysis

OPENLANE disclosed 37 risk factors in its most recent earnings report. OPENLANE 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

OPENLANE Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
$2.87B36.436.27%11.45%741.65%
$675.90M17.918.37%0.68%67.41%
$18.38B12.79-2.54%3.03%1.52%-15.83%
$717.92M-1.11-31.61%348.38%-1821.85%
$1.64B-14.18%30.08%21.11%
$548.41M-13.43
$135.76M-45.88%-90.19%79.52%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
KAR
OPENLANE
26.99
10.66
65.28%
CARS
Cars
11.00
-5.19
-32.06%
UXIN
Uxin
2.66
-1.40
-34.48%
CANG
Cango
4.05
1.75
76.09%
ACVA
ACV Auctions
9.16
-8.66
-48.60%
VRM
Vroom, Inc.
24.10
-0.54
-2.19%

OPENLANE Corporate Events

Business Operations and StrategyStock BuybackPrivate Placements and Financing
OPENLANE Completes Major Stock Repurchase
Positive
Oct 8, 2025

On October 8, 2025, OPENLANE, Inc. announced the completion of its repurchase of 53% of its Series A Convertible Preferred Stock. This was financed by amending its existing Credit Agreement with an additional $550 million in secured term loans. The financing was oversubscribed, allowing the company to secure favorable terms, which underscores the strong market demand and confidence in OPENLANE’s asset-light digital marketplace model. The move is part of OPENLANE’s strategy to enhance long-term shareholder value and positions the company for continued growth.

The most recent analyst rating on (KAR) stock is a Hold with a $30.00 price target. To see the full list of analyst forecasts on OPENLANE stock, see the KAR Stock Forecast page.

Business Operations and StrategyStock Buyback
OPENLANE Announces Major Stock Repurchase Agreement
Positive
Sep 9, 2025

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.

The most recent analyst rating on (KAR) stock is a Buy with a $32.50 price target. To see the full list of analyst forecasts on OPENLANE stock, see the KAR Stock Forecast page.

OPENLANE Reports Strong Q2 2025 Financial Growth
Aug 7, 2025

OPENLANE, Inc., a leader in the global wholesale used vehicle industry, offers technology-driven remarketing solutions that streamline transactions for buyers and sellers worldwide. The company recently reported its second quarter 2025 financial results, showcasing significant growth across various metrics. OPENLANE’s second quarter saw a 21% year-over-year increase in marketplace dealer volume and a 10% rise in Gross Merchandise Value (GMV) to $7.5 billion. The company’s revenue grew by 9% to $482 million, driven by a 24% increase in auction fee revenue. Additionally, income from continuing operations surged by 212% to $33 million, while adjusted EBITDA rose by 21% to $87 million. Cash flow from operating activities increased by 91% to $72 million, and adjusted free cash flow grew by 34% to $87 million. OPENLANE’s management highlighted the scalability of their digital operating model, with the marketplace segment now contributing 51% to consolidated adjusted EBITDA. The company also raised its full-year guidance for adjusted EBITDA and operating adjusted EPS, reflecting confidence in sustained growth and profitability. Looking ahead, OPENLANE is well-positioned to capitalize on the industry’s shift from physical to digital platforms and anticipates increased off-lease supply starting in 2026.

OPENLANE’s Strong Q2 2025: Revenue and Guidance Up
Aug 7, 2025

The recent earnings call for OPENLANE’s second quarter of 2025 painted a positive picture, showcasing a robust performance with notable growth in revenue, adjusted EBITDA, and dealer-to-dealer volumes. The company has successfully enhanced its financial standing by reducing debt and elevating its guidance for the year. Although challenges such as declining commercial vehicle volumes, rising SG&A expenses, and potential tariff impacts pose some risks, the positive aspects of the report significantly overshadow these concerns.

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.Date of analysis: Oct 22, 2025