Morningstar - Carsales.Com Limited (CAR) SK Encar Acquisition Gives Carsalesâ€™ EPS Growth a Shot in the Arm

Report

Morningstar

Gareth James

EUR 101.80 For Business Accounts Only

SK Encar Acquisition Gives Carsalesâ€™ EPS Growth a Shot in the Arm

We have increased our fair value estimate for narrow-moat-rated Carsales.com by 5% to AUD 13.70 per share following its acquisition of the 51% of SK Encar it doesnâ€™t already own from SK Holdings. Carsales appears to have secured a good price for its investment, considering that we estimate the fiscal 2018 price/earnings multiple at around 21 times, and underlying net profit after tax is growing at around 25% per year. In comparison, Carsales trades on a fiscal 2018 PE multiple of around 24 and i...

20/11/2017 14 EN

Underlying

Carsales.Com Limited

Carsales.com's principal activities consists of: online advertising services, which include classified advertising and display advertising services; data and research services, which include software, analysis, research and reporting, valuation services, website development and hosting as well as photography services; finance and related services, which include the Stratton Finance Pty Ltd subsidiary that provides finance arrangements for vehicles, boats, and other leisure items, vehicle procurement and other related services to customers; and international services, in which Co. has operations in overseas countries through both subsidiaries and equity accounted associate investments.

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AU000000CAR3 Australian Securities Exchange Australia

Provider

Morningstar

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.

Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.

We have operations in 27 countries.

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Analysts

Gareth James

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SK Encar Acquisition Gives Carsalesâ€™ EPS Growth a Shot in the Arm

CAR Group Ltd: 1 director

Carsales Entitlement offer

CARSALES.COM reduced its risk exposure resulting in an upgrade to Slightly Positive

Business as Usual for No-Moat Lonza; Specialty Ingredients Carve-Out on Track for 2020

Sasol Provides Full-Year Production Update

Astra Posts Solid 2Q, Driven by Strong Cancer Drug Sales and Moving Away From One-Time Divestments

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