Wall Street Zen Downgrades CarGurus (NASDAQ:CARG) to Hold

Key Points

• Wall Street Zen downgraded CarGurus from a buy to a hold, adding to a mixed analyst outlook that now includes 7 Buy ratings and 8 Hold ratings. The stock’s consensus rating remains Hold with a consensus price target of $37.79.
• CarGurus shares were down 1.8% and opened at $27.17, near the lower end of their 52-week range of $26.39 to $39.42. The stock also traded below both its 50-day and 200-day moving averages.
• The company recently beat earnings estimates, reporting $0.58 EPS on revenue of $243.56 million, with revenue up 8.2% year over year. Management also guided Q2 2026 EPS to 0.570-0.640.

CarGurus (NASDAQ:CARG - Get Free Report) was downgraded by Wall Street Zen from a "buy" rating to a "hold" rating in a note issued to investors on Saturday.

Several other research analysts also recently commented on CARG. Weiss Ratings downgraded CarGurus from a "hold (c+)" rating to a "hold (c)" rating in a research note on Wednesday, May 13th. DA Davidson reduced their target price on CarGurus from $37.50 to $33.50 and set a "neutral" rating for the company in a research note on Friday, February 20th. Needham & Company LLC lifted their target price on CarGurus from $37.00 to $43.00 and gave the stock a "buy" rating in a research note on Friday, May 8th. BTIG Research reduced their target price on CarGurus from $44.00 to $37.00 and set a "buy" rating for the company in a research note on Friday, February 20th. Finally, UBS Group set a $35.00 target price on CarGurus in a research note on Thursday, May 28th. Seven equities research analysts have rated the stock with a Buy rating and eight have issued a Hold rating to the stock. Based on data from MarketBeat, CarGurus has a consensus rating of "Hold" and a consensus price target of $37.79.

CarGurus Stock Down 1.8%

CARG stock opened at $27.17 on Friday. CarGurus has a twelve month low of $26.39 and a twelve month high of $39.42. The business has a 50 day moving average price of $32.45 and a two-hundred day moving average price of $33.55. The company has a market cap of $2.45 billion, a price-to-earnings ratio of 17.88, a P/E/G ratio of 1.01 and a beta of 1.20.

CarGurus (NASDAQ:CARG - Get Free Report) last issued its earnings results on Thursday, May 7th. The company reported $0.58 EPS for the quarter, topping the consensus estimate of $0.56 by $0.02. CarGurus had a return on equity of 54.42% and a net margin of 15.57%.The company had revenue of $243.56 million during the quarter, compared to the consensus estimate of $243.10 million. During the same period in the previous year, the company posted $0.46 EPS. The firm's revenue for the quarter was up 8.2% compared to the same quarter last year. CarGurus has set its Q2 2026 guidance at 0.570-0.640 EPS. On average, equities research analysts anticipate that CarGurus will post 2.11 EPS for the current fiscal year.

Insider Buying and Selling

In related news, CMO Dafna Sarnoff sold 5,445 shares of the company's stock in a transaction dated Thursday, April 2nd. The shares were sold at an average price of $33.04, for a total transaction of $179,902.80. Following the completion of the sale, the chief marketing officer owned 134,369 shares of the company's stock, valued at $4,439,551.76. This represents a 3.89% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Jennifer Ladd Hanson sold 2,499 shares of the company's stock in a transaction dated Tuesday, March 31st. The stock was sold at an average price of $35.61, for a total transaction of $88,989.39. Following the sale, the insider directly owned 98,191 shares of the company's stock, valued at $3,496,581.51. This represents a 2.48% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders have sold 20,924 shares of company stock valued at $669,419. 16.99% of the stock is owned by insiders.

Institutional Investors Weigh In On CarGurus

Several institutional investors and hedge funds have recently bought and sold shares of CARG. UBS Group AG lifted its position in CarGurus by 158.2% during the third quarter. UBS Group AG now owns 1,537,856 shares of the company's stock worth $57,254,000 after purchasing an additional 942,199 shares during the period. Wellington Management Group LLP lifted its position in CarGurus by 6.6% during the third quarter. Wellington Management Group LLP now owns 9,636,671 shares of the company's stock worth $358,773,000 after purchasing an additional 594,670 shares during the period. William Blair Investment Management LLC bought a new stake in CarGurus during the fourth quarter worth about $21,756,000. Northwestern Mutual Wealth Management Co. lifted its position in CarGurus by 159,137.1% during the fourth quarter. Northwestern Mutual Wealth Management Co. now owns 536,629 shares of the company's stock worth $22,787,000 after purchasing an additional 536,292 shares during the period. Finally, Prevatt Capital Ltd lifted its position in CarGurus by 28.1% during the third quarter. Prevatt Capital Ltd now owns 2,050,000 shares of the company's stock worth $76,322,000 after purchasing an additional 450,000 shares during the period. Institutional investors own 86.90% of the company's stock.

About CarGurus

CarGurus, Inc operates an online automotive marketplace designed to connect buyers and sellers of new and used vehicles. Through its proprietary search engine and data-driven pricing tools, the platform enables consumers to compare listings, assess fair market values and locate local dealers offering competitive deals. CarGurus also provides detailed vehicle history reports, dealer reviews and financing options to streamline the car-shopping process for both private parties and franchised dealerships.

The company's core product offerings include Instant Market Value (IMV), which leverages pricing algorithms to help buyers identify over- or under-priced vehicles, as well as dealer subscription services that grant automotive retailers access to lead generation tools, targeted advertising and dynamic pricing insights.

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