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NEW YORK - SunCar Technology Group Inc. (NASDAQ:SDA), a $263 million market cap company currently trading near its 52-week low of $2.41, announced Monday that it anticipates doubling its business with Xiaomi in 2025 as their partnership progresses following the April 2024 launch of Xiaomi’s first electric SUV, the YU7.
The collaboration focuses on intelligent vehicle insurance services, with SunCar providing cloud-based auto insurance solutions specifically tailored for Xiaomi Auto vehicles. The partnership aims to create a fully digitized auto insurance service system for Xiaomi customers. According to InvestingPro analysis, SunCar appears undervalued at current levels, with analysts maintaining a strong buy recommendation.
SunCar, which describes itself as China’s leading cloud-based auto insurance service provider, has applied its artificial intelligence and big data analysis technologies to develop the insurance solution for Xiaomi’s electric vehicles. The company has demonstrated strong revenue growth of 24% in the last twelve months, though it operates with relatively modest gross margins of 12%.
Founded in 2007, SunCar operates cloud-based platforms connecting drivers with auto services and insurance options through a network of sales partners in China. The company has established a presence in the auto eInsurance market for electric vehicles and the B2B auto services sector in the country.
The announcement comes as Xiaomi continues its expansion into the electric vehicle market with its YU7 SUV that launched earlier this year.
The information is based on a company press release statement issued Monday.
In other recent news, SunCar Tech Group has reported significant developments that are attracting investor attention. BTIG analyst Marvin Fong maintained a Buy rating on SunCar Tech, with a $12 price target, after the company announced first-quarter revenue of $102.6 million for 2025, reflecting a 19.9% year-over-year increase. SunCar Tech also provided its inaugural full-year guidance, forecasting 18-22% revenue growth for 2025, estimated to reach between $521 million and $539 million. In addition to these financial highlights, SunCar Tech has expanded its partnership with BYD, including eInsurance services across 50 dealerships of BYD’s high-end EV brands, and announced a new agreement with China Construction Bank for Designated Driver services.
Oppenheimer has initiated coverage on SunCar Tech with an Outperform rating and a price target of $3.50, citing the company’s strong enterprise relationships and a promising free cash flow profile. The firm projects SunCar Tech’s EBITDA to grow at a compound annual growth rate of 69% from 2024 to 2027. Furthermore, SunCar Tech has secured a contract with the Sichuan Branch of Agricultural Bank of China to offer car wash and smart car wash concierge services, enhancing customer service through technology-driven solutions. These recent developments underscore SunCar Tech’s strategic initiatives and growth potential in the automotive insurance and service markets.
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