ACV Auctions' Recent Sell-Off Is A Chance To Own The Stock - Analyst Turns Bullish

ACV Auctions Inc. ACVA shares are trading higher on Thursday after Piper Sandler analyst Alexander Potter upgraded the company from Neutral to Overweight and raised the price target from $18 to $20.

The bullish stance reflects the company’s revised mid-term financial targets.

On analyst day, the company disclosed that it expects mid-term revenue of $1.4 billion and adjusted EBITDA of $350 million with a 25% margin.

The analyst writes that ACV faces minimal tariff risk, and he is not concerned about competition from new digital auction platforms and flat growth in the overall car auction market.

Potter expects ACV to sustain 20%+ revenue growth for over three years, with EBITDA growing faster and more than doubling in 2025.

The analyst projects a higher volume (over 3 million units by the 2030s) and a reduced WACC of 13.3% (from 13.5%) due to lower treasury yields.

Last month, the company reported fourth quarter EPS loss of $0.16 missing the consensus and sales of  $159.51 million beating the consensus of $155.91 million.

Price Action: ACVA shares are up 5.54% at $15.42 at the last check Thursday.

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