The WeBuyCars share price plummeted by 13.57% on Tuesday after a trading update disappointed investors.
On Tuesday, 28 October 2025, WeBuyCars published a trading statement on the anticipated financial results for the year ended 30 September 2025.
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%.
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%.
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.
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.
It said these new shares were issued in terms of the company’s pre-listing capital raise, which was approved by shareholders prior to the listing of WeBuyCars on the JSE.
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.
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.
Investors did not like the trading update, and the WeBuyCars share price fell 13.57% on the day.
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.
Analyst opinion on WeBuyCars
Shane Watkins, chief investment officer at All Weather Capital, explained that investors were expecting earnings of R2.50 per share.
When the company reported earnings of R2.14 to R2.15, which was essentially flat, the market reacted negatively.
The reason is that WeBuyCars is viewed as a growth stock. “The share is expensive, and expensive shares cannot disappoint,” Watkins explained.
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.
Watkins explained that twenty years ago, a share price would fall by a few percent when it released disappointing results.
“Today, if the results disappoint in any way, it falls ten to twenty per cent, much higher than previously,” he said.
The reason is that the local market has many foreign investors which shoot first and ask questions later.
Mark du Toit from Oyster Catcher Investments highlighted that this was only a trading update with very little information.
He advised investors to wait for the full results to assess the company’s prospects and see whether it is a good investment.
“They had a good first half. The trading update shows that they had a much slower second half,” he said.
Watkins added that there is widespread speculation that cheap Chinese cars entering the South African market are putting pressure on WeBuyCars.
With the much lower entry point for new cars, which is often cheaper than many used cars, the secondhand car market is taking strain.
“Many South Africans may prefer to buy a cheap new Chinese car rather than a secondhand Corolla,” he said.
