5 Most Promising Car Stocks According to Analysts

3. OPENLANE, Inc. (NYSE:KAR)

Average Analyst Price Target Upside: 43.34%

Average Analyst Price Target: $21

OPENLANE, Inc. (NYSE:KAR), formerly KAR Auction Services, Inc., provides a digital marketplace for used vehicles for its customers and sellers in North America, Europe, the Philippines, and Uruguay.

On December 4, OPENLANE, Inc. (NYSE:KAR) announced that it plans to acquire Cox Automotive’s Manheim Canada for $95 million. If the deal goes through, the online auction company will own the Manheim Montreal facility and auction sales, operations, and select staff of Manheim Canada.

3 Wall Street analysts covered OPENLANE, Inc. (NYSE:KAR), and all of them maintained a Buy rating on the stock. As of the December 15 market close, the average price target of $21 represented an upside of 43.34%.

White Brook Capital Partners commented on OPENLANE, Inc. (NYSE:KAR) in its first-quarter investor letter. Here is what it said:

“KAR Auction Services, Inc. (NYSE:KAR): More constrained banks have resulted in higher yields for incumbent non-bank dealer floor plan financing companies. This should positively impact the ability of KAR, a very large dealer floorplan lender, to lend profitably at higher yields.

KAR’s loans are typically installment loans where the principal must be paid along with interest.  Higher yields on still-high used car prices should incentivize dealers to wholesale cars they cannot retail more quickly and to accept lower bids for those cars when they do try to wholesale them. This is a positive for the fundamentals of both company divisions that has gone largely unappreciated.”