CarGurus, Inc. (CARG) has announced better-than-expected third-quarter financial results, further solidifying its position in the online automotive marketplace. The company reported earnings of 45 cents per share, surpassing the analyst consensus estimate of 42 cents. Revenue also came in strong at $231.358 million, exceeding the expected $223.537 million.
This positive performance has fueled optimism about CarGurus’s future growth. The company has raised its FY2024 adjusted EPS guidance to $1.67 to $1.73, surpassing the previous estimate of $1.64. CarGurus also anticipates sales in the range of $885.000 million to $905.000 million, slightly exceeding the analyst consensus of $883.61 million.
“We are proud of our third quarter results as our Marketplace revenue growth further accelerated, and we leveraged our cost base to drive operating efficiencies,” stated Jason Trevisan, Chief Executive Officer at CarGurus. “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, delivering actionable insights, tools, and functionalities that will over time drive adoption, engagement, and retention across our platform.”
The positive results have sparked a wave of bullish sentiment among analysts, prompting them to revise their price targets for CarGurus. Oppenheimer analyst Jed Kelly has maintained an Outperform rating while raising the price target from $32 to $44. DA Davidson analyst Tom White has maintained a Neutral rating but boosted the price target from $26.5 to $38.5. JP Morgan analyst Rajat Gupta has kept an Overweight rating and increased the price target from $36 to $40. Needham analyst Chris Pierce has reiterated a Buy rating and elevated the price target from $27 to $39.
The market responded favorably to the earnings announcement, with CarGurus shares gaining 4.9% to trade at $35.00 on Friday. These positive developments suggest that CarGurus remains a compelling investment opportunity for those seeking exposure to the growing online automotive market.
