TrueCar (TRUE) AI Stock Analysis

• Market Cap: $165.39M
• Dividend Yield: N/A
• Average Volume (3M): 390.38K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.18
• Revenue Growth: 11.66%
• EPS Growth: -4.69%
• Country: US
• Employees: 348
• Sector: Communication Services
• Sector Strength: 92
• Industry: Internet Content & Information
• EPS (TTM): -0.05
• Shares Outstanding: 88,441,490
• 10 Day Avg. Volume: 731,429
• 30 Day Avg. Volume: 390,384
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.51
• Enterprise Value/Revenue: 0.46
• Enterprise Value/Gross Profit: 0.54
• Enterprise Value/Ebitda: -5.33
• 1Y Price Target: $2.48
• Price Target Upside: 32.62% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• Rating: 54 Neutral
• Price Target: $2.00 ▲(6.95% Upside)

TrueCar's overall stock score is primarily impacted by its challenging financial performance, with ongoing profitability and cash flow issues. Technical analysis provides some positive short-term signals, but valuation remains unattractive due to negative earnings. The earnings call offers some optimism for future improvements, but current financial challenges weigh heavily on the score.

Positive Factors

Financial Performance

Shares traded up after better-than-expected Adjusted EBITDA and guidance for positive EBITDA and FCF in the second half of the year.

Innovation

TRUE launched generative AI and machine learning models that will enhance insights TRUE can provide dealers and improve the consumer shopper experience.

Sales Effectiveness

Prospect closing rates reached the highest level since 1Q21, indicating improved sales effectiveness.

Negative Factors

Growth Uncertainty

Overall, a disappointing quarter and guide with a big cloud on ultimate recovery in growth and profitability at a time when the cycle tailwinds from rising inventory on new vehicles are slowing.

Market Uncertainty

The company is withdrawing its outlook for accelerated growth and margin expansion due to uncertainty from newly implemented automotive sector tariffs.

Revenue Expectations

TRUE shares were under pressure primarily due to 1Q25 revenue guidance that was light on the top-line and also called for an unexpected Adjusted EBITDA loss of $5MM.

TrueCar Business Overview & Revenue Model

Company Description

TrueCar, Inc. operates as an internet-based information, technology, and communication services company in the United States. It operates its platform on the TrueCar website and mobile applications. Its platform enables users to obtain market-based pricing data on new and used cars, and to connect with its network of TrueCar certified dealers. The company also offers forecast and consulting services regarding determination of the residual value of an automobile at given future points in time, which are used to underwrite automotive loans and leases, and by financial institutions to measure exposure and risk across loan, lease, and fleet portfolios. In addition, it provides accurate, geographically specific, and real-time pricing information for consumers and dealers; TrueCar Trade, which gives consumers information on the value of their trade-in vehicles and enables them to obtain a guaranteed trade-in price before setting foot in the dealership; and DealerScience that provides dealers with advanced digital retailing software tools. The company was formerly known as Zag.com Inc. TrueCar, Inc. was incorporated in 2005 and is headquartered in Santa Monica, California.

How the Company Makes Money

TrueCar generates revenue mainly through its subscription and transaction-based models. The company earns money by charging automotive dealers a subscription fee for access to its platform, where they can gain leads and potential sales from customers. Additionally, TrueCar earns transaction fees when a vehicle is sold through its platform, which is typically a percentage of the sale price. The company also collaborates with various automotive manufacturers and financial institutions, which can provide additional revenue streams through partnerships and advertising arrangements. These relationships enhance TrueCar's market presence and contribute to its overall earnings.

TrueCar Financial Statement Overview

Summary

TrueCar faces financial pressure with ongoing losses and modest revenue growth. The balance sheet is stable with low leverage, but negative cash flow trends highlight liquidity issues. Improvements in operational efficiencies and revenue growth are critical for future financial health.

Income Statement

TrueCar's TTM data shows a slight revenue increase to $179M but remains unprofitable with a net loss of $35M, reflecting a challenging margin environment. The TTM gross profit margin is strong at 85.3%, but negative EBIT and EBITDA margins indicate significant operational challenges. Revenue growth over the past year is modest at 2.1%, showing slight recovery but not enough to offset persistent losses.

Balance Sheet

The balance sheet shows a stable equity position with a debt-to-equity ratio of 0.10, indicating low leverage and financial flexibility. The equity ratio of 76.6% suggests a strong capital structure. However, declining stockholders' equity and total assets over recent years pose potential risks to long-term stability.

Cash Flow

Cash flow analysis reveals negative operating cash flow and free cash flow in TTM, indicating liquidity issues. Free cash flow declined significantly, and the company faces challenges in converting operational performance into cash. The free cash flow to net income ratio is negative, reflecting difficulties in generating cash from operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	184.56M	175.60M	158.71M	161.52M	231.70M	278.68M
Gross Profit	157.15M	149.21M	142.85M	145.31M	209.46M	257.13M
EBITDA	-15.90M	-18.17M	-35.79M	-45.46M	-17.59M	6.11M
Net Income	-29.44M	-31.05M	-49.77M	-118.69M	-38.37M	76.54M
Balance Sheet
Total Assets	139.82M	159.69M	204.32M	251.53M	387.67M	458.06M
Cash, Cash Equivalents and Short-Term Investments	92.52M	111.83M	136.96M	175.52M	245.22M	273.31M
Total Debt	10.39M	11.28M	14.41M	23.01M	31.55M	36.74M
Total Liabilities	33.46M	41.55M	44.10M	54.26M	57.88M	75.28M
Stockholders Equity	106.36M	118.14M	160.22M	197.27M	329.79M	383.93M
Cash Flow
Free Cash Flow	-11.39M	-159.00K	-34.22M	-40.82M	3.50M	28.84M
Operating Cash Flow	-3.07M	7.70M	-22.41M	-29.14M	14.19M	39.12M
Investing Cash Flow	-8.32M	-7.86M	-11.81M	-8.03M	-4.21M	101.90M
Financing Cash Flow	-24.05M	-24.97M	-4.33M	-32.53M	-38.09M	-49.24M

TrueCar Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.87
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRUE, the sentiment is Negative. The current price of 1.87 is below the 20-day moving average (MA) of 1.91, above the 50-day MA of 1.82, and below the 200-day MA of 2.54, indicating a neutral trend. The MACD of 0.01 indicates Positive momentum. The RSI at 49.27 is Neutral, neither overbought nor oversold. The STOCH value of 48.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TRUE.

TrueCar Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATHM	77 Outperform	$3.57B	16.70	6.05%	6.05%	-7.06%	-20.71%
CARG	74 Outperform	$3.20B	26.09	29.24%	―	4.80%	―
OPRA	73 Outperform	$1.46B	22.14	9.18%	4.59%	26.71%	-23.67%
EVER	71 Outperform	$855.50M	18.87	34.34%	―	92.91%	―
Sector *	60 Neutral	$44.03B	1.71	-11.99%	3.98%	2.32%	-37.93%
GENI	60 Neutral	$3.27B	―	-12.24%	―	25.76%	27.05%
TRUE	54 Neutral	$165.39M	―	-23.53%	―	11.66%	-4.69%

TrueCar Corporate Events

TrueCar Elects New Director at Annual Meeting

On May 22, 2025, TrueCar held its 2025 Annual Meeting of Stockholders, where proxies representing approximately 79% of the shares entitled to vote were present. During the meeting, Faye M. Iosotaluno was elected as a Class II director, PricewaterhouseCoopers LLP was ratified as the independent public accounting firm for 2025, and the executive officer compensation was approved.

The most recent analyst rating on (TRUE) stock is a Buy with a $5.00 price target. To see the full list of analyst forecasts on TrueCar stock, see the TRUE Stock Forecast page.