Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Why DealerTrack Holdings' Shares Dropped Temporarily

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

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 DealerTrack Holdings (Nasdaq: TRAK  ) , a provider of web-based software to the automotive industry, shed as much as 12% before rebounding to be down just 3% as of this writing, following its third-quarter earnings results.

So what: For the quarter, DealerTrack recorded a 3% increase in revenue, to $99.1 million, and an adjusted profit of $0.28. Both results fell slightly shy of the Wall Street consensus, which called for $99.5 million in sales and a profit of $0.30. What appears to be making up for the shortfall is the company's updated full-year guidance, which was slightly boosted from its own previous forecasts to a revenue range of $387 million to $390 million, and EPS of $1.08-$1.12, which (using the midpoint of EPS) are both slightly higher than current Street expectations.

Now what: DealerTrack has provided investors with a nice balance of organic growth and growth by acquisition, acquiring ClickMotive to broaden its digital retailing potential, and Ford's (NYSE: F  ) Canadian iConnect direct marketing solutions division. The only concern I have is whether we've given the company too frothy a valuation -- 20 times forward earnings -- given that global consumer spending is weak and auto sales have slowed since mid-year. For now, this is one I'd rather watch from the sidelines.

Will Ford pick up the slack and help companies like DealerTrack heading into 2013, or will weakened consumer spending put a kibosh on near-term growth? Find out the answer to this question and much more by getting your copy of our latest premium research report on Ford. Packed with in-depth analysis on the opportunities and threats facing Ford -- and complete with a year of regular updates -- this report will give you the tools needed to make smart long-term investing decisions.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2105482, ~/Articles/ArticleHandler.aspx, 10/23/2016 4:33:27 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

12/31/1969 7:00 PM
TRAK.DL $0.00 Down +0.00 +0.00%
Dealertrack Techno… CAPS Rating: **
F $12.02 Up +0.05 +0.42%
Ford CAPS Rating: ****