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

Key Points

• Wall Street Zen downgraded CarGurus from “buy” to “hold,” although the broader analyst consensus remains “Moderate Buy” with an average price target of $40.25.
• CarGurus reported quarterly EPS of $0.66, beating the $0.61 consensus estimate, while revenue of $250.97 million also exceeded expectations. The company guided for third-quarter EPS of $0.63–$0.69.
• Shares opened at $38.99 and have risen 7.2%, nearing the 12-month high of $41.22; insiders sold 31,764 shares worth approximately $1.07 million during the last quarter.

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

A number of other equities research analysts have also recently commented on CARG. JPMorgan Chase & Co. upped their target price on shares of CarGurus from $36.00 to $38.00 and gave the company a "neutral" rating in a report on Friday, May 8th. Royal Bank Of Canada raised their price target on CarGurus from $35.00 to $42.00 and gave the stock an "outperform" rating in a report on Friday. Freedom Capital upgraded CarGurus to a "strong-buy" rating in a research report on Friday, June 12th. Weiss Ratings cut CarGurus from a "hold (c+)" rating to a "hold (c)" rating in a research report on Wednesday, May 13th. Finally, Piper Sandler reiterated a "sector weight" rating on shares of CarGurus in a research note on Friday, June 12th. One research analyst has rated the stock with a Strong Buy rating, eight have given a Buy rating and six have assigned a Hold rating to the company. According to data from MarketBeat.com, CarGurus has a consensus rating of "Moderate Buy" and a consensus target price of $40.25.

CarGurus Trading Up 7.2%

Shares of CARG opened at $38.99 on Friday. The company's 50 day simple moving average is $32.85 and its 200-day simple moving average is $32.65. The firm has a market cap of $3.52 billion, a PE ratio of 21.19, a price-to-earnings-growth ratio of 1.33 and a beta of 1.17. CarGurus has a 12-month low of $26.39 and a 12-month high of $41.22.

CarGurus (NASDAQ:CARG - Get Free Report) last released its quarterly earnings results on Thursday, August 6th. The company reported $0.66 EPS for the quarter, beating the consensus estimate of $0.61 by $0.05. The firm had revenue of $250.97 million during the quarter, compared to the consensus estimate of $249.85 million. CarGurus had a net margin of 18.06% and a return on equity of 59.79%. CarGurus's revenue for the quarter was up 7.2% on a year-over-year basis. During the same quarter in the prior year, the firm earned $0.57 EPS. CarGurus has set its Q3 2026 guidance at 0.630-0.690 EPS. As a group, equities research analysts forecast that CarGurus will post 2.11 EPS for the current fiscal year.

Insiders Place Their Bets

In other news, CTO Matthew Todd Quinn sold 3,824 shares of the firm's stock in a transaction on Thursday, July 2nd. The shares were sold at an average price of $35.03, for a total value of $133,954.72. Following the completion of the sale, the chief technology officer owned 233,146 shares in the company, valued at approximately $8,167,104.38. This trade represents a 1.61% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, General Counsel Javier Zamora sold 8,072 shares of the business's stock in a transaction dated Monday, June 1st. The stock was sold at an average price of $29.53, for a total transaction of $238,366.16. Following the transaction, the general counsel owned 103,061 shares in the company, valued at approximately $3,043,391.33. This trade represents a 7.26% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last quarter, insiders sold 31,764 shares of company stock worth $1,071,649. 18.19% of the stock is owned by insiders.

Hedge Funds Weigh In On CarGurus

Institutional investors and hedge funds have recently added to or reduced their stakes in the business. Horizon Investments LLC boosted its holdings in shares of CarGurus by 2.0% in the 4th quarter. Horizon Investments LLC now owns 16,375 shares of the company's stock valued at $628,000 after purchasing an additional 318 shares during the last quarter. ProShare Advisors LLC increased its holdings in shares of CarGurus by 2.8% during the 4th quarter. ProShare Advisors LLC now owns 15,992 shares of the company's stock worth $613,000 after buying an additional 436 shares during the last quarter. Ritholtz Wealth Management raised its position in shares of CarGurus by 4.2% in the 1st quarter. Ritholtz Wealth Management now owns 11,039 shares of the company's stock worth $376,000 after buying an additional 449 shares during the period. Hennion & Walsh Asset Management Inc. raised its position in shares of CarGurus by 1.9% in the 2nd quarter. Hennion & Walsh Asset Management Inc. now owns 24,318 shares of the company's stock worth $829,000 after buying an additional 459 shares during the period. Finally, HighTower Advisors LLC boosted its holdings in CarGurus by 7.8% in the fourth quarter. HighTower Advisors LLC now owns 7,094 shares of the company's stock valued at $272,000 after acquiring an additional 514 shares during the last quarter. Institutional investors and hedge funds own 86.90% of the company's stock.

Key Stories Impacting CarGurus

Here are the key news stories impacting CarGurus this week:

• Positive Sentiment: Q2 earnings beat expectations: CarGurus reported adjusted earnings of $0.66 per share, up from $0.57 a year earlier and above analysts’ estimates of approximately $0.61–$0.62. Revenue reached $251.0 million, slightly exceeding consensus expectations and increasing 13% year over year. CarGurus Beats Q2 Earnings and Revenue Estimates
• Positive Sentiment: Strong profitability and cash generation: Second-quarter GAAP net income from continuing operations was $49.2 million. Adjusted EBITDA was $84.7 million, near the high end of company guidance, while operating cash flow was $94.6 million and free cash flow was $87.7 million. CarGurus Announces Second Quarter 2026 Results
• Positive Sentiment: Above-consensus Q3 outlook: CarGurus guided for third-quarter EPS of $0.63–$0.69, ahead of the $0.61 analyst consensus. Revenue guidance of $253.5 million–$258.5 million was broadly consistent with expectations, suggesting continued year-over-year growth. CarGurus Earnings Report
• Positive Sentiment: Share repurchases support per-share value: The company repurchased $29.2 million of stock during Q2. Since December 2022, cumulative repurchases have exceeded 30% of shares outstanding, which can support EPS and shareholder returns. CarGurus Q2 Results Presentation
• Neutral Sentiment: Revenue was only modestly above estimates, and the available report does not provide a clear updated full-year 2026 EPS target. Investors may therefore focus on future growth trends and the company’s ability to sustain its strong margins and cash flow.

CarGurus Company Profile

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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