"We like Bitauto for its strong online-to-offline capability in sales leads generation. We expect a performance-based solution to offer meaningful upside in its wallet share among dealers. Valuation is attractive compared to peers and we recommend investors to accumulate," said analysts Evan Zhou and Dick Wei in the report.
By midafternoon, shares had soared 13.8% to $35.03.
Separately, TheStreet Ratings team rates BITAUTO HOLDINGS LTD -ADR as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate BITAUTO HOLDINGS LTD -ADR (BITA) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, solid stock price performance and impressive record of earnings per share growth. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 16.1%. Since the same quarter one year prior, revenues rose by 40.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- BITA has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.73, which clearly demonstrates the ability to cover short-term cash needs.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Internet Software & Services industry and the overall market, BITAUTO HOLDINGS LTD -ADR's return on equity exceeds that of both the industry average and the S&P 500.
- Powered by its strong earnings growth of 58.33% and other important driving factors, this stock has surged by 230.58% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, BITA should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- BITAUTO HOLDINGS LTD -ADR reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, BITAUTO HOLDINGS LTD -ADR increased its bottom line by earning $0.96 versus $0.53 in the prior year. This year, the market expects an improvement in earnings ($1.48 versus $0.96).
- You can view the full analysis from the report here: BITA Ratings Report