The Carsales.com Ltd (ASX: CAR) share price will be one to watch this reporting season.
With more COVID-19 induced lockdowns and border closures, there could be pent-up demand amongst consumers.
As a result, investors will be keen to see how Carsales performed during this period.
These operating conditions are very similar to the ones faced by the online automotive company last year.
Let's take a look at how the Carsales share price responded last earnings season.
Here's how Carsales shares responded last year
The Carsales share price was given a jump-start after reporting its results for FY20.
Shares in the online automotive company soared more than 4% higher on the day.
Despite the impacts of COVID-19, the company revealed growth in revenue and profits.
Carsales reported adjusted revenue of $423 million for FY20, a 1% increase on the year prior.
In addition, the company saw earnings before interest, taxes, depreciation and amortisation (EBITDA) grow 6% to $237 million.
Carsales also reported EBITDA margins of 55%, reflecting the company's strong operating leverage and cost control.
In addition, Carsales also declared a final dividend of 25 cents per share which was on par with the previous year.
Carsales share price snapshot
The Carsales share price has continued its strong momentum into 2021, currently nudging record highs.
Shares in the online automotive company have soared more than 14% since the start of the year.
Carsales operates the largest online automotive, motorcycle, and marine online classifieds business in Australia.
The company's operations have also expanded into South Korea and Brazil.
Following the pandemic, Carsales cited a strong rebound in demand for vehicles across multiple international markets as a driver of growth.
For FY21, Carsales expects revenue between $433 million to $437 million. In addition, the company expects an increase in net profit after tax, forecasting estimates of $149 million to $153 million for the year.
Analysts at UBS have parried their positivity on the company.
The broker recently slapped a buy rating on shares in Carsales with a share price target of $24.
UBS also forecasts Carsales to pay out dividends of 44 cents per share in FY21.
Carsales is listed to report its earnings for the full year on Monday the 16th of August.
