The online car-shopping platform announced today that Chip Perry will become the company's CEO on December 15. Perry is the former CEO of AutoTrader.com, which is an online marketplace for car shoppers and sellers.
"My initial focus will be on TrueCar's dealer partners - listening to them and finding ways to serve them better," Perry said in a statement.
TrueCar's founder and CEO, Scott Painter, will resign as CEO and chairman. TrueCar stock has declined about 65% year-to-date.
"It's time for a change and we have found exactly the right person for the job," Painter said in a statement.
So far today, 1.95 million shares of TrueCar have traded, versus the company's 30-day average of 1.05 million shares.
Separately, TheStreet Ratings team rates TRUECAR INC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
We rate TRUECAR INC (TRUE) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- TRUE's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 56.94%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Internet Software & Services industry average, but is greater than that of the S&P 500. The net income increased by 18.6% when compared to the same quarter one year prior, going from -$13.64 million to -$11.11 million.
- The gross profit margin for TRUECAR INC is currently very high, coming in at 85.60%. Regardless of TRUE's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TRUE's net profit margin of -15.33% significantly underperformed when compared to the industry average.
- Compared to other companies in the Internet Software & Services industry and the overall market, TRUECAR INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Although TRUE's debt-to-equity ratio of 0.11 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 3.85, which clearly demonstrates the ability to cover short-term cash needs.
- You can view the full analysis from the report here: TRUE
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.