Things are looking up for online automotive marketer Autobytel Inc., which faced a delisting warning from Nasdaq and had several years of unprofitability up until last year.
The Irvine-based company is back in the black amid surging revenue that got it to No. 49 on this week’s list of the Fastest Growing Public Companies in Orange County (see list, page 40).
Autobytel had $65 million in revenue for 12 months through June in a 31% increase from a similar span through June 2010.
Autobytel’s revenue growth primarily is tied to its sales of consumer leads to auto dealers and manufacturers. It also sells ad space on its websites, offering auto data to consumers via Autobytel.com, MyRide.com and Autoweb.com.
In another arrangement, Autobytel struck an agreement with Cincinnati-based E.W. Scripps Co. this year to provide automotive content and reviews for Scripps’ 13 TV-station websites.
Back in Black
Autobytel reported an annual profit of $416,000 in 2011, its first since 2004. The company lost $8.6 million in 2010.
“They’ve had one of the greatest rebounds in Orange County as of late,” said George Santana, director of research at Ascendiant Capital Markets LLC in Irvine.
The company’s comeback is closely tied to the auto industry’s comeback.
“As people are in a position to buy a car, they are more likely to go online to look for information,” Santana noted.
Light-vehicle sales nationwide were up 10% last year to 12.8 million units, according to Woodcliff Lake, N.J.-based Autodata Corp.’s Motor Intelligence website. They’re on pace for more than 14 million this year.
The online automotive-marketing industry has seen some consolidation during the past few years, with Autobytel buying Tampa, Fla.-based Autotropolis Inc. and Cyber Ventures Inc. two years ago for a combined $15 million. Autobytel competes with Atlanta-based car-selling and -buying platform AutoTrader.com, which acquired Irvine-based vehicle information and resale value company Kelley Blue Book Co. for more than $500 million in 2010.
Other competitors include buying, sel- ling and vehicle information websites TrueCar.com and Edmunds.com, both headquartered in Santa Monica.
• Headquarters: Irvine
• Business: online automotive marketing
• Founded: 1995
• Ticker symbol: ABTL (Nasdaq)
• 2011 revenue: $37.8 million
• Recent earnings: $231,000 for June quarter
• Market value: About $35 million
• Notable: Provides automotive content for Cincinnati-based E.W. Scripps’ 13 TV-station websites.
Autobytel’s recent healthy turnaround has spurred talks of more potential deals.
“I wouldn’t be surprised if Autobytel continues to acquire other companies, or gets acquired by another company,” Santana said.
Stock Price
Autobytel shares were trading in penny stock territory last year when Nasdaq warned of a possible delisting if the company didn’t raise its share price above $1 for 10 consecutive days.
Autobytel responded with a reverse stock split, taking five shares from each shareholder and giving one share in return. The move helped it comply with the Nasdaq order by June.
It market value remains smallish, at about $35 million.
“With its current market cap, Autobytel can’t attract bigger investors,” Santana said. “So the stock hasn’t rebounded as much as its business has.”
Autobytel’s management isn’t flashy. Executives keep low profiles, and the company issues few press releases, the analyst noted.
“[But its] management performs very well and does what they say they will do,” Santana added.
Autobytel shares recently have traded at around $4 per share. Ascendiant has a “strong buy” rating on the stock with a $7 target share price.
“We estimate Autobytel will generate over $5 million in operating cash for fiscal year 2012 and over $7.5 million for fiscal year 2013,” Santana said.
