Berenberg lowers target price on Auto Trader

Auto Trader reported its H125 results on 7 November, with shares ending the session down 7% as a result. While management reiterated its FY25 outlook, Berenberg noted that the shape of delivery has changed, with consensus forecasts for average revenue per retailer likely to come down and for retailer forecourts likely to go up, with those factors expected to offset each other.

In the German bank's view, yesterday's share price move reflected some scepticism about the company's ability to re-accelerate ARPR growth to deliver FY26 consensus forecasts.

Berenberg, which has a 'hold' rating on the stock, added that Auto Trader shares were currently trading on a 24.0x FY25 price-to-earnings ratio.

Reporting by Iain Gilbert at Sharecast.com