WeBuyCars kisses R10.64 billion goodbye

WeBuyCars has seen 43.9% of its value disappear over the last year, with the company’s market cap declining by R10.64 billion.

A year ago, WeBuyCars was trading at R57.93 per share. A year later, the price plummeted to R32.50 per share.

Most of the slide happened over the last six months, during which the company’s share price declined by 38%.

A year ago, WeBuyCars’ market cap was R24.24 billion. On Friday, 24 July 2026, it was R13.6 billion. This means shareholders lost R10.64 billion.

It raises the question of why investors have changed their tune on WeBuyCars, which was the darling of the Johannesburg Stock Exchange after it listed in April 2024.

The reasons for this share price decline are varied, ranging from increased competition to inflated investor expectations.

The main reason is the rise in affordable Chinese and Indian vehicles in South Africa, which has caused a structural shift in the market.

Many consumers who would historically buy a mid-tier used car can now purchase a new Chinese car at a similar or lower price.

To compete with these affordable new cars, WeBuyCars had to proactively reduce its prices, which created price deflation and lower profit margins.

Another reason is shareholder expectations. As WeBuyCars traded at a high multiple, its results could not disappoint. This is what happened.

Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) declined 1.3% to R789.5 million, and operating profit was down 4% to R701 million.

Headline earnings were 1.6% lower at R500 million, and headline earnings per share declined 1.7% to 120 cents per share.

A particularly concerning figure for investors was net cash generated from operating activities, which declined 77% to R65 million.

Equally concerning was the company’s net interest-bearing liabilities, which increased 56% to R2.1 billion.

This represents a rapid and significant escalation in debt compared to R1.3 billion in 2025 and R1.2 billion in 2024.

Another concern is that vehicles are sitting on the floor for longer before being sold. Inventory days increased to 33.2 in 2026 from 28.9 in 2025.

Investors did not like what they saw in WeBuyCars’ latest results, and the share price declined after the results were released.

Simon Brown is upbeat about WeBuyCars’ prospects

Not everyone is bearish about WeBuyCars. Just One Lap founder Simon Brown told Business Day TV that the pullback offers investors a good entry point to buy the stock.

“WeBuyCars is a classic investing conundrum. We saw it at R20 and decided to wait and see. It rushed to R40, and we wished we had bought in,” he said.

“It surged to R60, and we kicked ourselves for missing out. Now that it’s back at R30, everyone is suddenly terrified of it.”

However, Brown said this is not a good way to see the situation. He argues that the market is giving investors a second opportunity.

He argued that the affordable Chinese cars are a short-term headwind as they will enter the second-hand market in time.

“Today, you can buy a brand-new Chinese vehicle for R350,000 that comes packed with tech, features, and extra bells and whistles,” Brown said.

“However, as those Chinese cars age and enter the secondhand market over time, that dynamic will shift and ultimately start working in WeBuyCars’ favour.”

He is also confident that the company will reach its goal of capturing 30% market share in the South African secondhand car sector.

“Their main growth story remains on track. I know people who have sold cars to them and had a great experience,” he said.

WeBuyCars share price over 1 year