CAR share price in focus
Since the 1990s, CAR Group has been a leading operator of online marketplaces focused on cars, motorcycles, and other vehicles.
As a marketplace provider, CAR Group aims to simplify the buying and selling process, offering added security and convenience for both buyers and sellers. Through a blend of technology and advertising solutions, the company ensures peace of mind for users when making significant purchases.
Over the years, CAR Group has experienced steady growth and now operates globally, with a presence in markets such as Australia (carsales), South Korea (Encar), the United States (Trader Interactive), and Chile (chileautos).
TCL shares
Transurban, founded in 1999, manages and develops urban toll road networks in Australia, Canada and the United States.
Transurban has an interest in 22 urban motorways across its portfolio. Some of its notable motorways include the CityLink in Melbourne, Hills M2 in Sydney and the Logan Motorway in Brisbane.
Transurban invests heavily in the development of new projects which are paid back through collecting toll revenue from motor vehicles.
CAR & TCL share price valuation
As a growth company, some of the trends we might investigate from CAR include revenue growth, profit growth, and return on equity (ROE). These measures can indicate the growth rates and prospects of the company, as well as their ability to generate returns from their assets.
Since 2021, CAR has grown revenue at a rate of 37.0% per year to reach $1,099m in FY24. Over the same stretch of time, net profit has increased from $131m to $250m. As for ROE, CAR last reported a ROE of 8.6%.
Since TCL is more of a ‘mature’ or ‘blue-chip’ business, some of the metrics that could be considered important include the debt/equity ratio, average yield, and return on equity, or ROE. These are useful as they give us an idea of debt levels and the company’s ability to generate a return on assets and pay out profits (which is what we want from a blue chip). In FY24, Transurban Group reported a debt/equity ratio of 175.1%, meaning the company is leveraged (it has more debt than equity). Higher debt levels come with increased risk so it’s important that a leveraged company has stable returns and the capacity to pay interest on its debts.
As for dividends, since 2020 TCL has paid an average dividend yield of 3.6% per year.
Finally, in FY24, TCL reported an ROE of 3.0%. For a mature business you’re generally looking for an ROE of more than 10%, so TCL’s returns are a bit less than what we’d expect.
Keep in mind that these are only a small selection of metrics. We don’t have enough information to value the business or make an investment decision. To learn more about valuation, check out one of our free online investing courses.
