By
Anders Bylund (TMF Zahrim)
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More Articles
November 30, 2011
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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of vehicle auctioneer specialist KAR Auction Services (NYSE: KAR ) revved up an early 11.3% gain before falling back to a more modest 3% gain, all on spasms of heavy trading in otherwise light action.
So what: A glowing value-based recommendation, published after hours last night on Seeking Alpha, inspired an impressive but low-volume and quickly erased price spike. Such is the market-moving power of popular blogs when dealing with thinly traded stocks like KAR.
Now what: If you like the used-car market, KAR stands about a belly button below quality competitors Comerica (NYSE: CMA ) and Copart (Nasdaq: CPRT ) in nearly every department. KAR's operating margins are about half of Copart's or Comerica's, and its growth engines have stalled. Some stocks are cheap for a reason, and this one looks like a lemon. Back to the dealership you go.
Interested in more info about KAR Auction Services? Add it to My Watchlist.
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