This is an overreaction. And investors looking for a possible 5% to 8% bounce should take this stock for a joyride. Take a look at the chart. 
TRUE data by YCharts
TRUE data by YCharts
Since reaching a high of $21 in intraday trading Thursday, TrueCar stock has crashed 15% to current levels of around $17.84. And there has been no justification for it. And with fourth-quarter revenue climbing almost 40% in the just-ended quarter, customers are embracing the companies business model.
TrueCar, headquartered in Santa Monica, Calif., wants to disrupt the customer car-buying experience. The 10-year old company went public last May at around $9 per share, 25% below the low end of its estimated range of $12 to $14. And by offering 7.8 million shares, the company, which sells advertising apace on its Web site, raised $70 million.
TrueCar is now looking to re-invent the way car dealers attract customers and sell cars. It's a unique concept, which has attracted may new car shoppers.
During the quarter, the company posted a 34% year-over-year jump in the number of average monthly unique visitors, reaching 4.4 million. For the full year, average monthly unique visitors surged 55% to 4.3 million.
Fourth-quarter revenue climbed 38% year over year to $55.5 million, in-line with Wall Street estimates. But here's the thing; the company raised its first-quarter outlook, guiding revenue to $59 million, above estimates of $58.6 million. For full year 2015, the company projects revenue in the range of $280 million to $290 million, compared with estimates of $281.3 million.
And while the stock does carry a steep multiple, trading at almost 150 times 2015 earnings estimates of 12 cents per share, TrueCar did beat estimates in the just-ended quarter. And that the company is growing its average transaction value (monetization) both sequentially (up 3.6%) and year over year (up 1.2%), this indicates higher future earnings potential for TrueCar, especially since the revenue is growing faster than its costs (38% vs. 37%).
Last but not least, despite the stock's punishment, analysts are broadly positive about TrueCar's prospects. The stock still has a consensus buy rating with average price target of $22.50, suggesting 26% gains. And investors with an appetite for risk and willing to be patient should hold in TrueCar stock and ride it to higher profits in 2015.
By Richard Saintvilus
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