April 25, 2012 / 5:48 PM / 6 years ago

UPDATE 2-Zipcar rev outlook disappoints, shares slide

* Q2 loss/shr $0.08 vs est $0.10

* Revenue $59.1 mln vs est $59.3 mln

* Sees Q2 revenue $71-$74 mln vs est $74.1 mln

* Maintains 2012 revenue view of $290 to $296 mln

* Shares fall as much as 13 pct

April 25 (Reuters) - U.S. car-sharing industry leader Zipcar Inc forecast quarterly revenue below market estimates amid rising competition, sending its shares down as much as 13 percent to their life-low.

Cost-conscious customers and rising energy prices have driven growth in the made car-sharing market, attracting new entrants like Hertz Global Holdings Inc.

Increased competition will pressure Zipcar’s high-margin membership fees and the company will likely see a rise in costs to acquire and retain customers, said MKM Partners analyst Christopher Agnew.

Zipcar, which allows customers to rent cars at an hourly or daily rate and often park in convenient reserved spots, expects revenue between $71 million and $74 million for the second quarter, the company said in a statement on Wednesday.

Analysts on average were expecting $74.1 million in revenue, according to Thomson Reuters I/B/E/S.

The outlook implies a 15 to 20 percent growth in revenue for the current quarter, compared to the 30 percent growth that Zipcar recorded for 2011.

“In order for the current valuation to be justified, revenue growth should be accelerating, not decelerating,” said Agnew, who has a “sell” rating on the stock.

Zipcar - which is highly successful in urban areas and colleges, where fewer people can afford owning cars and parking is scarce and expensive - said higher marketing expenses drove up its cost per new account by 34 percent for the first quarter.

The company, which also operates in Canada, the United Kingdom and Spain, posted a loss of 8 cents per share for the quarter ended March 31, compared with analysts’ estimate of a loss of 10 cents per share.

Revenue rose 20 percent to $59.1 million. Total members grew 23 percent to more than 709,000.

The company’s shares, which have lost more than half their value since their debut last April, fell to a low of $12 on Wednesday morning on the Nasdaq. They were later trading down 10 percent at $12.46. (Reporting by Megha Mandavia in Bangalore; Editing by Joyjeet Das)

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