JPMorgan downgraded TrueCar (NASDAQ:TRUE) from Neutral to Underweight, citing ongoing strategic shifts, execution challenges, and a tougher industry backdrop as reasons for a more cautious outlook. As a result, the company’s shares dropped more than 9% intra-day today.
While the company is aiming to streamline the car-buying process by integrating data and analytics into a more transparent digital platform, JPMorgan analysts see significant hurdles ahead. TrueCar is simultaneously working on expanding its OEM and trade-in businesses, rebuilding its user base after losing the USAA partnership, and developing a new consumer interface—all while navigating a complex macro environment.
The recent introduction of new tariffs adds to the pressure, potentially impacting pricing dynamics and slowing adoption of new product offerings. JPMorgan also expects delays in monetization from direct OEM relationships, compounding near-term revenue uncertainty.
With multiple transitions still underway and headwinds mounting, the downgrade reflects growing concern that TrueCar may struggle to gain traction in a competitive and cyclical auto retail market.