Cars.com (NYSE:CARS) Shares Gap Up - Here's Why

Key Points

• Cars.com shares opened higher, rising from a prior close of $10.29 to $10.75, though they later traded around $10.73.
• Analyst sentiment remains moderately positive: the stock has a consensus “Moderate Buy” rating and a $14.58 price target, despite UBS lowering its target to $11.50.
• The company’s latest quarterly results met earnings expectations at $0.51 per share, while revenue reached $179.93 million and increased 0.7% year over year. Institutional investors own approximately 89.15% of the outstanding shares.

Cars.com Inc. (NYSE:CARS - Get Free Report)'s stock price gapped up before the market opened on Friday. The stock had previously closed at $10.29, but opened at $10.75. Cars.com shares last traded at $10.7270, with a volume of 3,777 shares traded.

Analyst Ratings Changes

CARS has been the topic of a number of analyst reports. UBS Group reduced their price target on Cars.com from $13.00 to $11.50 and set a "neutral" rating on the stock in a research report on Wednesday, October 7th. Weiss Ratings cut Cars.com from a "hold (c)" rating to a "hold (c-)" rating in a research report on Tuesday, September 29th. BTIG Research restated a "buy" rating and issued a $14.00 target price on shares of Cars.com in a research report on Thursday, August 6th. Finally, Zacks Research raised Cars.com from a "hold" rating to a "strong-buy" rating in a report on Friday, October 9th. One equities research analyst has rated the stock with a Strong Buy rating, three have assigned a Buy rating and four have assigned a Hold rating to the company's stock. According to data from MarketBeat.com, Cars.com currently has an average rating of "Moderate Buy" and a consensus price target of $14.58.

Cars.com Trading Down 2.1%

The company has a market cap of $571.70 million, a PE ratio of 18.72 and a beta of 1.64. The firm has a fifty day moving average of $11.04 and a two-hundred day moving average of $10.84. The company has a current ratio of 2.00, a quick ratio of 2.00 and a debt-to-equity ratio of 1.01.

Cars.com (NYSE:CARS - Get Free Report) last posted its quarterly earnings results on Thursday, August 6th. The company reported $0.51 earnings per share for the quarter, hitting the consensus estimate of $0.51. Cars.com had a return on equity of 18.82% and a net margin of 4.73%. The company had revenue of $179.93 million for the quarter, compared to the consensus estimate of $180.53 million. During the same quarter in the prior year, the business posted $0.41 EPS. The firm's quarterly revenue was up .7% compared to the same quarter last year. As a group, sell-side analysts predict that Cars.com Inc. will post 1.61 EPS for the current year.

Insider Buying and Selling

In other news, Director Donald McGovern sold 8,000 shares of the firm's stock in a transaction dated Thursday, August 20th. The shares were sold at an average price of $12.25, for a total value of $98,000.00. Following the completion of the sale, the director owned 102,900 shares in the company, valued at approximately $1,260,525. This trade represents a 7.21% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, insider Angelique Marks sold 57,980 shares of the company's stock in a transaction dated Monday, August 17th. The stock was sold at an average price of $11.94, for a total transaction of $692,281.20. Following the completion of the transaction, the insider owned 149,636 shares in the company, valued at $1,786,653.84. This represents a 27.93% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Corporate insiders own 3.36% of the company's stock.

Institutional Investors Weigh In On Cars.com

A number of large investors have recently made changes to their positions in the stock. Sterling Capital Management LLC grew its holdings in shares of Cars.com by 2,714.5% during the 3rd quarter. Sterling Capital Management LLC now owns 25,809 shares of the company's stock worth $265,000 after purchasing an additional 24,892 shares during the period. Versant Capital Management Inc boosted its stake in Cars.com by 250.1% during the 3rd quarter. Versant Capital Management Inc now owns 5,356 shares of the company's stock valued at $55,000 after acquiring an additional 3,826 shares during the last quarter. Amundi bought a new stake in shares of Cars.com in the 2nd quarter worth $192,000. VIRGINIA RETIREMENT SYSTEMS ET Al purchased a new stake in shares of Cars.com in the second quarter worth approximately $1,118,000. Finally, Pale Fire Capital SE boosted its stake in Cars.com by 1.3% during the 2nd quarter. Pale Fire Capital SE now owns 4,008,218 shares of the company's stock valued at $43,850,000 after purchasing an additional 51,600 shares during the period. 89.15% of the stock is currently owned by hedge funds and other institutional investors.

About Cars.com

Cars.com Inc NYSE: CARS operates a digital automotive marketplace that connects consumers with automotive dealers and manufacturers. Its platform enables shoppers to research vehicles, compare listings, read reviews, obtain financing information and connect with sellers when buying new or used cars.

The company provides automotive retailers with digital marketing, advertising, inventory merchandising, website and digital retailing solutions, as well as data and analytics tools. Its portfolio includes the Cars.com marketplace and related brands and services focused on dealer reviews, vehicle financing, automotive content and customer engagement.

Cars.com primarily serves the United States automotive market, working with consumers, franchised and independent dealerships, original equipment manufacturers and other industry participants.

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