JPMorgan raises Kar Auction stock price target to $25 on dealer momentum

Published 07/08/2025, 14:52
JPMorgan raises Kar Auction stock price target to $25 on dealer momentum

Investing.com - JPMorgan raised its price target on Kar Auction (NYSE:KAR) to $25.00 from $22.00 on Thursday, while maintaining a Neutral rating on the stock. The company’s shares, currently trading at $28.83, have delivered impressive returns with a 45.67% gain year-to-date, according to InvestingPro data.

The firm cited KAR’s unified product portfolio and brand positioning as key factors driving strong momentum with U.S. dealers. JPMorgan noted that investments in on-ground sales force and go-to-market initiatives have created opportunities for increased market share across various geographies. These initiatives have contributed to the company’s solid 7.95% revenue growth over the last twelve months, though InvestingPro analysis suggests the stock may be trading above its Fair Value.

North America dealer consignment volumes and unique buyers and sellers increased by double digits year-over-year in the second quarter. Over the past 12 months, KAR’s sales initiatives have driven robust seller consignment growth, which JPMorgan views as a critical component of the company’s marketplace strategy. With a market capitalization of $3.1 billion and a P/E ratio of 57.92, investors seeking deeper insights can access comprehensive valuation metrics and 14 additional ProTips through InvestingPro.

The commercial off-lease business in the U.S. continues to augment the dealer marketplace, with both features now integrated on a single platform with single-sign-on functionality. This integration is creating network effects that are expected to intensify into the second quarter and second half of 2026.

KAR reiterated confidence that off-lease volumes will return to year-over-year growth in the second quarter of 2026, based on higher industry-wide lease maturities, with declines in consumer and grounding dealer retention rates providing additional support.

In other recent news, OpenLane Inc. reported its second-quarter 2025 earnings, which exceeded market expectations. The company posted an earnings per share (EPS) of $0.33, significantly surpassing the forecasted $0.22. Additionally, OpenLane’s revenue reached $482 million, higher than the anticipated $454.5 million. This strong performance was further highlighted by OpenLane’s reported revenue of $481.7 million and EBITDA of $86.7 million, both surpassing BofA Securities’ estimates. Consequently, BofA Securities raised its price target for Kar Auction to $29.00 from $26.00, maintaining a Neutral rating on the stock. These developments reflect a positive trend in OpenLane’s financial performance.

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