{"id":841276,"date":"2025-10-30T07:00:00","date_gmt":"2025-10-30T05:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=841276"},"modified":"2025-10-30T07:04:45","modified_gmt":"2025-10-30T05:04:45","slug":"webuycars-under-siege","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/motoring\/841276\/webuycars-under-siege\/","title":{"rendered":"WeBuyCars under siege"},"content":{"rendered":"\n

The WeBuyCars share price plummeted by 13.57% on Tuesday after a trading update disappointed investors.<\/p>\n\n\n\n

On Tuesday, 28 October 2025, WeBuyCars published a trading statement on the anticipated financial results for the year ended 30 September 2025.<\/p>\n\n\n\n

It said it was set to report an increase in headline earnings of over 100%, with core headline earnings rising by between 12% and 17%.<\/p>\n\n\n\n

However, due to the issuance of 83 million new shares in the past financial year, core headline earnings per share are only expected to rise by between 0.8% and 6%.<\/p>\n\n\n\n

The issuance of these new shares in February, March, and April 2024 also distorts the basic earnings per share and headline earnings per share of the company.<\/p>\n\n\n\n

These new shares bring the total weighted average number of ordinary shares at 30 September 2025 to 417,401,341, up from 375,029,205 in 2024.<\/p>\n\n\n\n

It said these new shares were issued in terms of the company\u2019s pre-listing capital raise, which was approved by shareholders prior to the listing of WeBuyCars on the JSE.<\/p>\n\n\n\n

WeBuyCars said its basic earnings will rise by more than 100% from R343.1 million in 2024 to over R926.8 million when it releases results next month.<\/p>\n\n\n\n

As a result, basic earnings per share will also rise by more than 100%. The company expects headline earnings per share to more than double.<\/p>\n\n\n\n

Investors did not like the trading update, and the WeBuyCars share price fell 13.57% on the day.<\/p>\n\n\n\n

We Buy Cars’ market cap fell from R22.5 billion on the closing price of 27 October to R19.5 billion on the closing price of 28 October 2025.<\/p>\n\n\n\n

Analyst opinion on WeBuyCars<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

Shane Watkins, chief investment officer at All Weather Capital, explained that investors were expecting earnings of R2.50 per share.<\/p>\n\n\n\n

When the company reported earnings of R2.14 to R2.15, which was essentially flat, the market reacted negatively.<\/p>\n\n\n\n

The reason is that WeBuyCars is viewed as a growth stock. \u201cThe share is expensive, and expensive shares cannot disappoint,\u201d Watkins explained.<\/p>\n\n\n\n

He explained that it was not uncommon for the share price of growth companies to plummet by between 10% and 20% when their results are disappointing.<\/p>\n\n\n\n

Watkins explained that twenty years ago, a share price would fall by a few percent when it released disappointing results.<\/p>\n\n\n\n

\u201cToday, if the results disappoint in any way, it falls ten to twenty per cent, much higher than previously,\u201d he said.<\/p>\n\n\n\n

The reason is that the local market has many foreign investors which shoot first and ask questions later.<\/p>\n\n\n\n

Mark du Toit from Oyster Catcher Investments highlighted that this was only a trading update with very little information.<\/p>\n\n\n\n

He advised investors to wait for the full results to assess the company\u2019s prospects and see whether it is a good investment.<\/p>\n\n\n\n

\u201cThey had a good first half. The trading update shows that they had a much slower second half,\u201d he said.<\/p>\n\n\n\n

Watkins added that there is widespread speculation that cheap Chinese cars entering the South African market are putting pressure on WeBuyCars.<\/p>\n\n\n\n

With the much lower entry point for new cars, which is often cheaper than many used cars, the secondhand car market is taking strain.<\/p>\n\n\n\n

\u201cMany South Africans may prefer to buy a cheap new Chinese car rather than a secondhand Corolla,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"

The WeBuyCars share price took a beating on Tuesday after a trading update disappointed investors.<\/p>\n","protected":false},"author":10,"featured_media":829658,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11119],"tags":[19503,23946,23145,21735,12861],"class_list":["post-841276","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-motoring","tag-all-weather-capital","tag-mark-du-toit","tag-oyster-catcher-investments","tag-shane-watkins","tag-webuycars"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/841276","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=841276"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/841276\/revisions"}],"predecessor-version":[{"id":841278,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/841276\/revisions\/841278"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/829658"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=841276"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=841276"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=841276"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}