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Osaka Matsui Management analysts report online used car dealer Vroom files for IPO

Osaka Matsui Management analysts says Vroom is planning to generate $100 million in the filing

Analysts at Osaka-based financial services company, Osaka Matsui Management, reports that Vroom, the New York-based online used car dealer, has filed for an initial public offering.

“New York-based Vroom announced in the filing that it plans to generate $100 million however, this number is often a placeholder and Vroom will update this as it gets closer to listing its shares,” reported Michael Carter, Head of Global Equities at Osaka Matsui Management.

“The company is planning to list its common stock on the Nasdaq Global Market under the symbol ‘VRM’,” Michael added.

In December, Vroom raised USD 254 million in a Series H round of funding. That investment arrived almost a year after the company’s USD 146 million Series G raise.

According to analysts at Osaka Matsui Management, the Series H round brought Vroom’s total raised to date at USD 721 million since its inception in 2013. The start-up refused to reveal its full valuation however, in December last year, The Wall Street Journal reported the company had been valued at USD 1.5 billion.

Vroom sells used, reconditioned cars directly to customers through its website and app. The company collects cars from sellers and delivers to buyers through what it describes as a “private-seller acquisition model” built on a user interface that is mobile-enabled. The company also offers customers financing, warranty and insurance.

“In the filing, Vroom posted a first-quarter net loss of $27.1 million, which was down from $41.1 million in the first quarter of 2019. Vroom’s revenue has risen from $235.1 million a year ago, up to $375.8 million this year,” reported Alistair Richmond, Director of Corporate Trading at Osaka Matsui Management.

“Vroom has earned $308.7 million in revenue in the first quarter, which primarily comes from its retail vehicle sales,” he added.

“The company’s revenue peaked at $1.19 billion in 2019, compared to $855.4 million back in 2018. Its net loss was also up for the year, climbing to $143 million compared to $85.2 million,” Alistair concluded.

Vroom said that the COVID-19 pandemic hurt sales in March and as a result, the company reduced its inventory, among other defence measures. Vroom said it had roughly a third of its staff furloughed and reduced salaries for the remaining team, including executives.

Vroom had USD 156.4 million in cash and cash equivalents, as of April 30, 2020.

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