LONDON (ShareCast) - (Sharecast News) - Auto Trader shares were down on Thursday following a cut to 'add' by analysts over at Peel Hunt.
Despite an improvement in new car sales since March, Peel Hunt pointed to a reversal in September due to supply issues related to the newly introduced Worldwide Harmonised Light Vehicle Test Procedure as something that could weigh on the advertiser's revenues.

However, the broker said that the data released so far had shown a "more resilient" used car market.

Peel Hunt voiced some concerns regarding Facebook and Amazon's entry into the automotive market but, with Auto Trader developing solutions for new markets, mainly digital marketing for new cars and B2B, the broker seemed confident that the impact from both companies would remain "limited" for now.

"We continue to believe the medium - term opportunity for Auto Trader is strong."

The analysts also praised Auto Trader's ability to diversify its revenue streams in order to be less reliant on listings growth.

"Product has become the largest contributor to growth in ARPR, and we expect this to continue into 2019."

Peel Hunt reiterated its 500p target price on the FTSE 100 resident.

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