Kestrel Investment Management Corp Invests $3.75 Million in Cars.com Inc. $CARS

Key Points

• Kestrel Investment Management opened a new position in Cars.com during the fourth quarter, buying 307,550 shares worth about $3.75 million. The stake represents about 2.1% of Kestrel’s portfolio and roughly 0.51% of Cars.com.
• Cars.com shares fell 5.2% even after the company reported revenue that was essentially in line with expectations. However, its latest quarterly EPS of $0.45 missed estimates of $0.48, which weighed on the stock.
• Analyst sentiment is mixed but generally cautious: the stock currently has a Hold consensus rating and a consensus price target of $14.67. Recent updates included a B. Riley downgrade to neutral and BTIG raising its target to $14 while keeping a buy rating.

Kestrel Investment Management Corp bought a new position in shares of Cars.com Inc. (NYSE:CARS - Free Report) during the fourth quarter, according to its most recent filing with the SEC. The fund bought 307,550 shares of the company's stock, valued at approximately $3,752,000. Cars.com accounts for 2.1% of Kestrel Investment Management Corp's investment portfolio, making the stock its 25th largest holding. Kestrel Investment Management Corp owned about 0.51% of Cars.com at the end of the most recent reporting period.

A number of other hedge funds also recently made changes to their positions in CARS. Par Capital Management Inc. bought a new stake in shares of Cars.com during the 2nd quarter worth $14,220,000. Hill Path Capital LP raised its stake in shares of Cars.com by 23.2% during the 3rd quarter. Hill Path Capital LP now owns 2,481,032 shares of the company's stock worth $30,318,000 after purchasing an additional 468,000 shares during the period. Bridgeway Capital Management LLC bought a new stake in shares of Cars.com during the 2nd quarter worth $3,776,000. JPMorgan Chase & Co. raised its stake in shares of Cars.com by 143.4% during the 3rd quarter. JPMorgan Chase & Co. now owns 531,486 shares of the company's stock worth $6,495,000 after purchasing an additional 313,128 shares during the period. Finally, SG Americas Securities LLC bought a new stake in shares of Cars.com during the 3rd quarter worth $2,496,000. 89.15% of the stock is currently owned by institutional investors.

Cars.com Stock Down 5.2%

CARS stock opened at $11.68 on Friday. The company has a quick ratio of 1.87, a current ratio of 1.87 and a debt-to-equity ratio of 0.98. The firm has a market capitalization of $679.19 million, a PE ratio of 27.17 and a beta of 1.64. Cars.com Inc. has a twelve month low of $7.40 and a twelve month high of $13.97. The stock has a 50-day simple moving average of $9.23 and a two-hundred day simple moving average of $10.83.

Cars.com (NYSE:CARS - Get Free Report) last posted its earnings results on Thursday, May 7th. The company reported $0.45 earnings per share for the quarter, missing analysts' consensus estimates of $0.48 by ($0.03). The company had revenue of $180.22 million for the quarter, compared to analysts' expectations of $180.16 million. Cars.com had a net margin of 3.73% and a return on equity of 18.12%. The firm's quarterly revenue was up .7% compared to the same quarter last year. During the same period in the previous year, the firm earned $0.37 EPS. On average, equities analysts predict that Cars.com Inc. will post 1.83 EPS for the current fiscal year.

Wall Street Analysts Forecast Growth

CARS has been the topic of a number of recent analyst reports. B. Riley Financial cut Cars.com from a "buy" rating to a "neutral" rating and set a $13.00 target price on the stock. in a research note on Friday. Zacks Research upgraded Cars.com from a "strong sell" rating to a "hold" rating in a research note on Wednesday, April 15th. DA Davidson restated a "buy" rating and issued a $13.00 price objective on shares of Cars.com in a research note on Monday, April 13th. BTIG Research boosted their price objective on Cars.com from $13.00 to $14.00 and gave the company a "buy" rating in a research note on Thursday. Finally, UBS Group boosted their price objective on Cars.com from $11.00 to $12.00 and gave the company a "neutral" rating in a research note on Friday. Three research analysts have rated the stock with a Buy rating, four have issued a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat, the stock currently has a consensus rating of "Hold" and a consensus price target of $14.67.

Key Cars.com News

Here are the key news stories impacting Cars.com this week:

• Positive Sentiment: Cars.com reaffirmed its 2026 outlook for flat to 2% revenue growth and a 29% to 30% adjusted EBITDA margin, while also boosting its share repurchase target to $90 million, signaling confidence in cash generation and capital return. Article link
• Positive Sentiment: Q1 results showed revenue of $180.2 million, adjusted EBITDA of $51.0 million, and an adjusted EBITDA margin of 28.3%, which exceeded guidance and suggests operating performance remains healthy despite modest top-line growth. Article link
• Positive Sentiment: BTIG Research raised its price target on Cars.com to $14 from $13 and kept a Buy rating, indicating some analysts see further upside from current levels. Article link
• Positive Sentiment: JPMorgan also lifted its price target to $11 from $10, even while maintaining a Neutral rating, reflecting improved valuation expectations after the earnings release. Article link
• Neutral Sentiment: Cars.com reported adjusted results that were largely in line with revenue expectations, but the market is balancing that against the earnings miss and modest growth profile. Article link
• Negative Sentiment: The company posted Q1 EPS of $0.45, missing Wall Street estimates of $0.48, which is the main reason shares have moved lower. Article link

Cars.com Profile

Cars.com operates as a leading online automotive marketplace in the United States, connecting car shoppers with new and used vehicle listings from dealerships and private sellers. The platform enables consumers to research makes and models, compare prices, read expert and user reviews, and access tools such as TrueCost to estimate ownership expenses over time. Through its website and mobile applications, Cars.com aims to simplify the car-buying process by aggregating detailed vehicle data, payment calculators, and dealership ratings into a single user-friendly experience.

On the dealer side, Cars.com provides a suite of marketing and lead-generation services designed to help automotive retailers reach potential buyers and manage their online presence.

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