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On Wednesday, BTIG analyst Marvin Fong confirmed a Buy rating on SunCar Tech Group (NASDAQ:SDA), maintaining the $12.00 price target. According to InvestingPro data, this target represents a potential 300% upside from the current price of $3.01. Fong highlighted SunCar’s first-quarter revenue of $102.6 million for 2025, marking a 19.9% year-over-year increase. This growth outpaced the 14.0% seen in the last quarter of 2024 and was in line with the third quarter of 2024’s 20.4% growth. The adjusted EBITDA loss improved to ($1.3 million) compared to ($3.1 million) in the same quarter the previous year. InvestingPro analysis suggests the stock is currently undervalued, with analysts maintaining a Strong Buy consensus.
SunCar provided its inaugural full-year guidance, forecasting 18-22% revenue growth for 2025, which is expected to reach between $521 million and $539 million. This projection surrounds BTIG’s prior estimate of $531.5 million and is aimed at giving investors confidence, especially those unfamiliar with the Chinese insurance and automotive services markets. InvestingPro data shows the company’s trailing twelve-month revenue growth at 24.15%, with a current market capitalization of $318 million. Fong noted that the anticipated revenue growth for 2025 closely mirrors the 21.5% growth of 2024, suggesting a consistent business pace for SunCar despite tariffs.
A significant development in the quarter was the expansion of SunCar’s partnership with electric vehicle (EV) giant BYD (SZ:002594), which dominates the Chinese new energy vehicle market with a 29.7% share as of April 2025. SunCar’s collaboration with BYD now includes extended eInsurance services across 50 dealerships under BYD’s high-end EV brands. Additionally, SunCar announced a new agreement with China Construction Bank (OTC:CICHF) to provide Designated Driver services, expected to generate RMB 60 million over the next year and a half.
The Designated Driver service, which is gaining traction in enterprise offerings, has seen new additions from major insurers such as PICC and Ping An Sichuan in select locations during the quarter, complementing SunCar’s existing agreements with CITIC and Shanghai Rural Commercial Bank.
With the complete data from 2024, BTIG has introduced quarterly estimates for SunCar in 2025. For the second quarter, they anticipate $138.5 million in revenue, a 17.9% growth, and expect a slight acceleration in growth as the year progresses due to easier comparisons and the scaling of recently announced deals. The full-year revenue estimate is set at $528.6 million, nearly unchanged from previous predictions, while the Adjusted EBITDA estimate remains at $8.1 million. The firm reiterates its Buy rating for SunCar Tech Group. InvestingPro subscribers have access to over 10 additional exclusive ProTips and comprehensive financial metrics that could help evaluate SunCar’s growth potential and market position more effectively.
In other recent news, SunCar Technology Group Inc. has announced several strategic developments. The company secured a contract with Leapmotor (HK:9863) to develop and manage an insurance management platform, marking a shift from a traditional insurance agency role to a technology partner for the electric vehicle manufacturer. This platform will be integrated into Leapmotor’s mobile app, offering services such as insurance issuance and claims processing. Additionally, SunCar expanded its partnership with Ping An Bank to enhance automotive aftermarket services for the bank’s customers, strengthening their "Finance + Automotive Services" ecosystem. This collaboration will continue to provide car wash and vehicle care solutions. SunCar also secured a deal with the Sichuan Branch of Agricultural Bank of China (OTC:ACGBF) to offer smart car wash services to its clients, furthering their strategic partnership. These developments indicate SunCar’s ongoing efforts to integrate financial services with automotive care. The company’s initiatives are based on press release statements and reflect its strategic direction in the auto services and insurance markets.
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