CarGurus Analysts Boost Their Forecasts Following Better-Than-Expected Earnings

CarGurus, Inc. (CARG) has reported impressive financial results for the third quarter, surpassing expectations and providing an optimistic outlook for fiscal year 2024.

In its latest earnings report, CarGurus announced quarterly earnings of 45 cents per share, which exceeded the analyst consensus estimate of 42 cents. Additionally, the company's quarterly sales reached $231.358 million, surpassing the expected $223.537 million.

Jason Trevisan, the Chief Executive Officer of CarGurus, expressed pride in the company's third-quarter results. He highlighted that the growth in Marketplace revenue has accelerated, alongside effective cost management that led to improved operating efficiencies. "Our customer-centric focus has enabled us to capture greater wallet share, as we strive to continuously enhance the value proposition we offer to our dealer partners," Trevisan stated. He emphasized their commitment to delivering actionable insights, tools, and functionalities designed to improve engagement and retention on their platform.

Looking ahead, CarGurus has projected adjusted earnings per share (EPS) for FY2024 to be between $1.67 and $1.73, which is above the estimate of $1.64. The company also anticipates sales in the range of $885 million to $905 million, compared to the estimate of $883.61 million.

Following this positive earnings report, CarGurus shares saw a significant increase, gaining 4.9% and trading at $35.00 on the subsequent Friday.

In light of these results, several analysts have adjusted their price targets for CarGurus. Here are some notable changes:

• Oppenheimer analyst Jed Kelly has maintained an Outperform rating and raised the price target from $32 to $44.
• DA Davidson analyst Tom White retained a Neutral rating with an increased price target from $26.5 to $38.5.
• JP Morgan analyst Rajat Gupta kept an Overweight rating and adjusted the price target from $36 to $40.
• Needham analyst Chris Pierce maintained a Buy rating, with the price target rising from $27 to $39.

This upbeat outlook and analyst support reflect confidence in CarGurus' ability to maintain its growth trajectory and expand its market presence.

Earnings, Forecasts, CarGurus