JPMorgan Upgrades TrueCar (TRUE) to Neutral

JPMorgan analyst Rajat Gupta upgraded TrueCar (NASDAQ: TRUE) from Underweight to Neutral.

The analyst comments "Earlier today, TRUE announced its acquisition by Fair Holdings, the holding company of TrueCar founder Scott Painter, in an all-cash go-private transaction valued at ~$2.55/sh, implying an equity valuation of ~$227 mn, representing a ~72% premium to TRUE’s closing price on 10/14, prior to the announcement. The transaction is expected to close by 4Q25 or early 1Q26, with Scott Painter set to return as CEO upon closing, with the merger agreement including a 30-day go-shop period and stipulates deal termination fees of ~$4–8 mn for TRUE and ~$15 mn for Fair. The deal is likely to be financed by a syndicate of strategic and financial investors from the automotive retail, finance, and technology sectors. Of the total ~$227 mn, ~$164 mn will come from an equity financing commitment from Alpha Auto, which is associated with multi-franchise operator Miami Lakes Automall (franchises for Chevrolet, CDJR, Kia, and Mitsubishi), with an additional ~$60 mn in equity financing expected from the syndicate, and the remaining ~$3 mn likely funded by TRUE’s existing balance sheet capacity (~$93 mn in cash and equivalents as of 2Q-end). Strategically, TrueCar under Fair Holdings appears set to maintain its focus on trust and transparency in the auto retail process, with no immediate changes to the business model indicated. Note, the transaction values TRUE at ~1.1x on JPMe 2026 sales, compared to peers CARG/CARS trading at ~3.6x/~0.9x, respectively. Net-net, today’s developments are not surprising given the strategic review process TRUE began in late 2024 and also in context of a continued choppy market backdrop, delaying any traction in their digital retail platform, TrueCar+, which was viewed as the anchor for long-term growth and sustainability. As such, we are also moving from Underweight to Neutral, reflecting the acquisition announcement and related favorable transaction terms."

For an analyst ratings summary and ratings history on TrueCar click here. For more ratings news on TrueCar click here.

Shares of TrueCar closed at $1.48 yesterday.

You May Also Be Interested In

• Chevron signed an agreement with Iraq's Basra Oil Company to advance commercial negotiations for West Qurna 2
• Trump: I asked Darline Graham to run for U.S. senate in special Republican primary on Tuesday, August 11
• Uber (UBER) Reiterated at Market Outperform by Citizens on Delivery Hero Deal