The firm set a "fair value" rating on the stock with a $37 price target. CRT called Trulia a solid number-two in the online real estate market behind Zillow (Z). The firm also contends that early results of Trulia's planned venture into brand marketing in 2014 have been positive but could also have substantial risks.
Earlier this week, Barclays initiated coverage on Trulia with an "equal weight" rating.
The stock was down 10.64% to $30.26 at 2:49 p.m. on Friday. More than 2 million shares had changed hands, greater than the average volume of 1,840,190.
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Separately, TheStreet Ratings team rates TRULIA INC as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate TRULIA INC (TRLA) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and feeble growth in the company's earnings per share."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- TRLA's very impressive revenue growth greatly exceeded the industry average of 16.1%. Since the same quarter one year prior, revenues leaped by 141.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Net operating cash flow has significantly increased by 143.58% to $4.39 million when compared to the same quarter last year. In addition, TRULIA INC has also vastly surpassed the industry average cash flow growth rate of 11.63%.
- TRLA's debt-to-equity ratio of 0.60 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 6.55 is very high and demonstrates very strong liquidity.
- TRULIA INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, TRULIA INC reported poor results of -$0.50 versus -$0.12 in the prior year. This year, the market expects an improvement in earnings (-$0.26 versus -$0.50).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Internet Software & Services industry. The net income has significantly decreased by 600.2% when compared to the same quarter one year ago, falling from -$1.59 million to -$11.15 million.
- You can view the full analysis from the report here: TRLA Ratings Report