TrueCar IPO Pricing, Valuation Revealed

Cameron Aubernon
by Cameron Aubernon

Automotive pricing site TrueCar has revealed its IPO price will be set between $12 and $14, bringing the company a valuation of around $1 billion should the price-per-share lean closer toward the top end.

The Wall Street Journal reports the IPO’s 7.78 million available shares — to be listed on NASDAQ as “TRUE” – could raise as much as $108.9 million once shares are made available.

Beyond the IPO, TrueCar will have 71 million shares outstanding; if priced at $14/share, the company’s market valuation will be $994 million.

Lead underwriters of the IPO are Goldman Sachs, J.P. Morgan and RBC Capital Markets.

Cameron Aubernon
Cameron Aubernon

Seattle-based writer, blogger, and photographer for many a publication. Born in Louisville. Raised in Kansas. Where I lay my head is home.

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  • Hreardon Hreardon on May 06, 2014

    I'm very interested in watching how this all plays out. The dealership networks are starting to push back hard on the third party/referral sites and a number of the larger chains have have already dropped them entirely in lieu of managing their own online presence. I can completely understand why they're going this route, I'm just interested to see how it plays out. Scuttlebutt is that what TrueCar is looking to do is build a brand and start moving into financing, leasing, warranty coverage, etc. That's the real profit center of the new car business and it's got the dealerships understandably nervous. What the dealership chains are looking to avoid more than anything is momentum building to tear down their legal protections. With public support seemingly behind Tesla and rumors that TrueCar is even looking to move into the retail space on top of the finance space, this could be the beginning of the end for those nice barriers the dealerships have put up to protect themselves. Then again, we've seen this play out over the years with other new entrants, only to fizzle out, so....

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    • Ruggles Ruggles on May 08, 2014

      Actually, it is the low overhead operations who maintain all sorts of advantages. How many of you want to invest in a company that demonizes dealers, but has built their revenue model on, well, dealers. Dealers are wising up. Some rather large dealer groups have figured out they can use the TrueCar site to validate their own prices WITHOUT paying the $300. fee to TC. It is amazing how many consumers don't know that using TrueCar increases the dealer's unit cost basis by $300. on a new vehicle. How does that work out in the long run? Current investors want to get rid of Scott Painter. He needs to cash out, buy a dealership, and try to learn how to run it before setting out to change an entire industry that is obviously not broken.

  • FormerFF FormerFF on May 06, 2014

    What sort of earnings does TrueCar have to justify this lofty valuation? I can't find anything on them.

    • Fred Fred on May 06, 2014

      They didn't offer me any kind of deal when I was shopping for a new car.

  • Imag Imag on May 06, 2014

    How are they different from CarsDirect, other than a prettier website? I used CarsDirect a couple times and it was great.

  • CapVandal CapVandal on May 07, 2014

    With IPO's, who knows. Disruptive businesses aren't necessarily profitable. That is, it is possible to depress auto retail margins without being able to capture much or any of it.

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