ACVA Plunges 1.30% to Record Low on Earnings Miss, EBITDA Guidance Cut

Shares of ACV Auctions (ACVA) fell to a record low on Monday, with an intraday drop of 1.30%. The decline follows a broader sell-off in the stock, which has struggled to maintain investor confidence amid operational and financial challenges.

The recent earnings report for Q2 2025 highlighted key concerns. Revenue rose 20.6% year-over-year to $193.7 million but missed estimates by 1.2%, signaling slowing growth. Units sold also lagged expectations, raising questions about the company’s ability to sustain engagement on its online vehicle auction platform. A downward revision to EBITDA guidance further fueled pessimism, as investors recalibrated expectations for profitability.

Analyst sentiment turned bearish in the wake of the report. Goldman Sachs, Citigroup, and Stephens all reduced price targets, with the latter cutting its estimate to $11.50—a 47% drop from prior levels. These downgrades amplified selling pressure, as institutional and retail investors adjusted positions in response to the revised outlook. Insider selling also contributed to the decline, with key executives offloading shares totaling 4.22% and 8.29% of their holdings, respectively.

Broader market dynamics added to the stock’s woes. ACVA’s inherent volatility—marked by 15 moves of over 5% in the past year—was exacerbated by uncertainty around Federal Reserve policy. While lower interest rates typically benefit e-commerce and inventory financing, the sharp post-earnings drop suggested investors prioritized operational risks over macroeconomic tailwinds. The stock’s 45.5% year-to-date decline, trading at $11.41, reflects a 50.8% pullback from its 52-week high.

Operational headwinds remain a critical factor. Intensifying competition in the online marketplace and rising customer acquisition costs have strained margins. While ACV expanded its No Reserve Sale program to boost activity, the move has yet to offset broader industry challenges. Despite a “Moderate Buy” analyst rating, the stock’s negative P/E ratio and elevated debt-to-equity ratio underscore ongoing skepticism about its path to profitability.

The recent selloff, however, may present a buying opportunity for contrarians. Historical volatility has often led to rebounds after sharp corrections, provided fundamental improvements materialize. Investors are advised to monitor the company’s ability to execute its growth initiatives and meet revised guidance before committing to long-term positions.