BitAuto Q3 Earnings Soar 70% As Dealers Tout Cars Online
BitAuto Holdings soared Friday after the Chinese auto information website easily beat third-quarter earnings estimates as advertising and marketing increasingly shifts online in the world's No. 1 auto market.
BitAuto (BITA) stock rose 16% to 91.91. Shares are up 188% this year but off the all-time high of 98.28, touched on Aug. 26.
Q3 earnings leapt 70% vs. a year earlier to 51 cents a share excluding various items. Analysts polled by Thomson Reuters had expected 49 cents.
Revenue rose 60% to $99 million. BitAuto had guided for $88.7 million-$91.9 million. Wall Street expected $94 million.
BitAuto sees Q4 revenue at $117.3 million to $120.6 million, up 49% to 53%. Analysts had modeled $109.9 million.
BitAuto didn't give an EPS target. Analysts see a 52% gain to 61 cents.
The company's operating profit margin rose to 25.9% in Q3 vs. 20.2% a year earlier.
"Going forward, our priority remains on further increasing op erating efficiency," BitAuto CFO Andy Zhang said in a statement.
BitAuto makes revenue from new-car sellers who place ads on bitauto.com, which lets buyers see vehicles, get prices and read reviews. Bitauto.com ad revenue rose 67.8% in Q3.
Taoche.com caters to used cars, still a nascent market.
BitAuto's EP platform offers subscription software to help auto dealers create online showrooms and market to consumers. This segment saw a 67.8% revenue gain.
"Our EP platform generated over 15.5 million general sales leads for our auto dealer customers, with our mobile product offerings becoming an increasingly important generator of sales leads," BitAuto CEO William Li said in the statement.
In June, the company struck a deal with No. 1 China search engine Baidu (BIDU) to be the exclusive supplier of auto-related content for the mobile segment of Baidu's Aladdin search platform.
BitAuto competitors include Autohome (ATHM), which on Nov. 5 reported slightly-better-than-expected Q3 earnings. But the stock fell 12% that day on a big jump in operating expenses and an offering of new shares. On Friday, Autohome rose 4%.
Other rivals include big Internet portals Sina (SINA) and Sohu (SOHU).
BitAuto's boom comes as China's car market strives to shake off slowing growth. The China Association of Automobile Manufacturers said Friday that October passenger car sales grew 6.4% vs. a year earlier to 1.7 million vehicles, in line with September's pace. Total sales, including trucks and buses, grew 2.8%, up from September's 2.5%.