It is Poised to be a Bull Market for Vroom Inc. (VRM)

Vroom Inc. (NASDAQ: VRM) stock jumped 1.67% on Friday to $0.94 against a previous-day closing price of $0.92. With 2.33 million shares changed hands, the volume of the stock remained lighter than its average volume of 4.21 million shares. During the session, the Auto & Truck Dealerships company that operates in wider Consumer Cyclical sector, reached to the highest price of $0.9699 whereas the lowest price it dropped to was $0.9200. The 52-week range on VRM shows that it touched its highest point at $8.62 and its lowest point at $0.82 during that stretch. It currently has a 1-year price target of $2.21.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of VRM was down-trending over the past week, with a drop of -17.98%, but this was down by -3.79% over a month. Three-month performance dropped to -9.22% while six-month performance fell -52.05%. The stock lost -87.30% in the past year, while it has lost -8.33% so far this year. A look at the trailing 12-month EPS for VRM yields -4.40 with Next year EPS estimates of -2.27. For the next quarter, that number is -0.71. This implies an EPS growth rate of -79.70% for this year and 14.80% for next year.

Float and Shares Shorts:

At present, 138.12 million VRM shares are outstanding with a float of 132.60 million shares on hand for trading. On Oct 13, 2022, short shares totaled 28.19 million, which was 20.41% higher than short shares on Sep 14, 2022. In addition to Mr. Robert R. Krakowiak as the firm’s CFO & Treasurer, Ms. Patricia Moran J.D., Esq. serves as its Chief Legal Officer & Sec.

Institutional Ownership:

Through their ownership of 37.21% of VRM’s outstanding shares, institutional investors have minority control over the company. Other institutions hold 6.98% of VRM, in contrast to 6.68% held by mutual funds. Shares owned by individuals account for 22.56%. As the largest shareholder in VRM with 4.49% of the stake, The Vanguard Group, Inc. holds 6,206,246 shares worth 6,206,246. A second-largest stockholder of VRM, Millennium Management LLC, holds 4,842,324 shares, controlling over 3.51% of the firm’s shares. NISA Investment Advisors LLC is the third largest shareholder in VRM, holding 3,776,968 shares or 2.73% stake. With a 3.14% stake in VRM, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 4,332,182 shares are owned by the mutual fund manager. The Vanguard Extended Market Index Fu, which owns about 1.24% of VRM stock, is the second-largest Mutual Fund holder. It holds 1,719,445 shares valued at 1.75 million. Fidelity Extended Market Index Fu holds 0.48% of the stake in VRM, owning 660,377 shares worth 0.67 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for VRM since 6 analysts follow the stock currently. There are 0 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 6 believe that the stock is worth HOLDING, 0 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With VRM analysts setting a high price target of $2.00 and a low target of $1.00, the average target price over the next 12 months is $1.28. Based on these targets, VRM could surge 112.77% to reach the target high and rise by 6.38% to reach the target low. Reaching the average price target will result in a growth of 36.17% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. VRM will report FY 2022 earnings on 02/27/2024. Analysts have provided yearly estimates in a range of -$2.68 being high and -$4.13 being low. For VRM, this leads to a yearly average estimate of -$3.46. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Vroom Inc. surprised analysts by -$0.14 when it reported -$0.76 EPS against a consensus estimate of -$0.62. The surprise factor in the prior quarter was $0.02. Based on analyst estimates, the high estimate for the next quarter is -$0.62 and the low estimate is -$0.77. The average estimate for the next quarter is thus -$0.69.

Summary of Insider Activity:

Insiders traded VRM stock several times over the past three months with 2 Buys and 1 Sells. In these transactions, 155,340 shares were bought while 7,204 shares were sold. The number of buy transactions has increased to 15 while that of sell transactions has risen to 8 over the past year. The total number of shares bought during that period was 3,158,208 while 62,316 shares were sold.

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