OPENLANE (KAR) AI Stock Analysis

• Market Cap: $3.04B
• Dividend Yield: N/A
• Average Volume (3M): 904.67K
• Price to Earnings (P/E): 38.6
• Beta (1Y): 1.01
• 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: 853,746
• 30 Day Avg. Volume: 904,674
• 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: 1.61
• Enterprise Value/Revenue: 2.67
• Enterprise Value/Gross Profit: 6.23
• Enterprise Value/Ebitda: 12.68
• 1Y Price Target: $31.10
• Price Target Upside: 9.01% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 71 Outperform
• Price Target: $32.00 ▲(12.16% Upside)

Kar Auction Services is positioned well with strong financial performance and positive technical indicators. The raised guidance and strategic stock repurchase further bolster its outlook. However, the high P/E ratio and absence of a dividend yield are notable concerns. Overall, the stock shows a promising recovery trajectory with strategic initiatives supporting future growth.

Positive Factors

Revenue Growth

Consistent revenue and EBITDA growth indicate strong market demand and effective business strategies, supporting long-term sustainability.

Strategic Investments

Investments in technology and market strategies enhance competitive positioning and operational efficiency, driving future growth.

Stock Repurchase

Repurchasing preferred stock reduces financial obligations and enhances shareholder value, improving financial flexibility and market confidence.

Negative Factors

Commercial Vehicle Volumes

Declining commercial vehicle volumes may limit growth in this segment, potentially impacting revenue diversification and market share.

Tariff-Related Uncertainty

Tariff uncertainties could affect supply chains and pricing, posing risks to sales volumes and profitability in the near to medium term.

Balance Sheet Concerns

Managing debt and equity carefully is crucial to maintain financial stability and support long-term investment and growth strategies.

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: Neutral
• Last Price: 28.53
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

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 28.53 is below the 20-day moving average (MA) of 28.89, above the 50-day MA of 27.15, and above the 200-day MA of 22.47, indicating a neutral trend. The MACD of 0.48 indicates Positive momentum. The RSI at 50.70 is Neutral, neither overbought nor oversold. The STOCH value of 16.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for KAR.

OPENLANE Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KAR	71 Outperform	$3.04B	38.60	6.27%	―	11.45%	741.65%
CARS	71 Outperform	819.07M	21.70	8.49%	―	0.68%	67.41%
CANG	58 Neutral	795.92M	-1.23	7.34%	―	348.38%	-1821.85%
ACVA	54 Neutral	1.76B	-26.66	-14.32%	―	30.08%	21.11%
CRMT	50 Neutral	266.56M	20.71	3.14%	―	0.79%	0.00%
UXIN	39 Underperform	727.78M	-18.86	74.03%	―	0.00%	0.00%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

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.