CAR Stock Report

2-Year Price History

Ockham's Rating

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CAR Revenue

For a long time, value investors have used the current share price relative to sales per share levels as an important valuation tool. We utilize a historical weighted average methodology that treats recent years more importantly in the calculation. When looking at CAR through this framework, we can see that our weighted average historical high and low Price to Sales per share ratios over the last 10 years are 0.34x and 0.15x respectively.

Utilizing this range we can see that CAR’s current Price to Sales per share ratio of 0.09x is significantly below its average levels historically. In fact, with a current price of $5.70, CAR is a full 63% below its average Price to Sales ratio at comparable sales levels. This is a rare occurrence and, when taken in context of the other areas of our analysis, can be a strong positive for our outlook for CAR.

CAR Cash Earnings

As the old saying goes, "Cash is King!" However, we prefer to capture a few other items within our analysis to identify "cash earnings". Nevertheless, an analysis of Cash Earnings is absolutely pivotal to assessing a company's value, and currently CAR is significantly below their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for CAR, the current level of Cash Earnings compared to its historical levels helps identify where CAR is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 2.12 and a historical low Cash Earnings per share ratio of 0.73, an investor can relate where value becomes optimal.

So what does "significantly below" mean when we talk about Price to Cash Earnings numbers for CAR? From the Ockham perspective, we are looking specifically at CAR to see if the market is recognizing the huge disparity between CAR's past stock price to Cash Earnings ratio to today's levels. At a difference of 25% below the average historical Price to Cash Earnings ratio, our view would be quite positive at this point. However, as with all metrics, we need to also take other factors into account when looking at CAR. While we view better Cash Earnings metrics as very important, if the market is slow to identify this value, or if Cash Earnings were to fall from these levels, we would become more neutral in our stance.

CAR Dividends

A positive Ockham rating does not require a company to pay out an inviting dividend or a dividend at all. However, we believe dividends provide a useful measure of a company's inherent expectations.