Cars.com (NYSE:CARS) Issues Quarterly Earnings Results, Misses Estimates By $0.03 EPS

Cars.com (NYSE:CARS) posted its quarterly earnings results on Thursday. The company reported $0.45 earnings per share for the quarter, missing the consensus estimate of $0.48 by ($0.03), Briefing.com reports. The company had revenue of $180.22 million for the quarter, compared to the consensus estimate of $180.16 million. Cars.com had a net margin of 3.73% and a return on equity of 18.12%. Cars.com’s quarterly revenue was up .7% compared to the same quarter last year. During the same quarter in the previous year, the company posted $0.37 EPS.

Here are the key takeaways from Cars.com’s conference call:

• Cars.com beat expectations in Q1 with $180.2M revenue (up 1% YoY), adjusted EBITDA margin 28.3% (>1 ppt above guidance), free cash flow up 42% YoY, and raised its 2026 share repurchase target to $90M while repurchasing 3.8M shares YTD.
• Management announced and began implementing a cost reduction program targeting $25M–$30M of recurring annualized operating savings to help grow adjusted EBITDA faster than revenue, with partial savings reflected in Q2 guidance.
• Product and AI initiatives are accelerating — MCP integration with ChatGPT, the Conversational Carson assistant (consumers are >4x more likely to submit a lead after interacting), and a new Dealer app — all intended to build an interconnected, AI-first marketplace and improve dealer ROI.
• OEM and national advertising revenue remains pressured (down about $2M YoY in Q1) as some manufacturers reallocated budgets, and management expects Q2 to be a trough with cautious timing for recovery, adding near-term revenue risk.
• Customer metrics are mixed — Marketplace added dealers (+140 YoY) but overall dealer/solutions and website units declined sequentially and AccuTrade subscribers fell as the company de-emphasizes standalone offerings in favor of bundled packages, creating short-term churn and execution risk.

Cars.com Stock Performance

Shares of NYSE CARS traded down $0.65 during trading on Friday, reaching $11.68. 1,098,516 shares of the stock traded hands, compared to its average volume of 907,628. Cars.com has a 52-week low of $7.40 and a 52-week high of $13.97. The company has a debt-to-equity ratio of 0.98, a current ratio of 1.87 and a quick ratio of 1.87. The company has a 50-day moving average of $9.23 and a 200-day moving average of $10.83. The stock has a market capitalization of $679.19 million, a P/E ratio of 27.17 and a beta of 1.64.

More 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

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently bought and sold shares of the business. Invesco Ltd. boosted its holdings in Cars.com by 11.4% in the 4th quarter. Invesco Ltd. now owns 252,690 shares of the company’s stock worth $3,083,000 after buying an additional 25,760 shares during the period. Caitlin John LLC bought a new position in Cars.com in the 4th quarter worth approximately $168,000. Vident Advisory LLC boosted its holdings in Cars.com by 10.0% in the 4th quarter. Vident Advisory LLC now owns 47,321 shares of the company’s stock worth $577,000 after buying an additional 4,298 shares during the period. State of Tennessee Department of Treasury boosted its holdings in Cars.com by 5.3% in the 4th quarter. State of Tennessee Department of Treasury now owns 36,904 shares of the company’s stock worth $419,000 after buying an additional 1,859 shares during the period. Finally, Mackenzie Financial Corp bought a new position in Cars.com in the 4th quarter worth approximately $1,030,000. 89.15% of the stock is owned by institutional investors.

Wall Street Analyst Weigh In

Several research firms recently weighed in on CARS. UBS Group increased their price target on shares of Cars.com from $11.00 to $12.00 and gave the company a “neutral” rating in a research report on Friday. BTIG Research increased their price target on shares of Cars.com from $13.00 to $14.00 and gave the company a “buy” rating in a research report on Thursday. DA Davidson restated a “buy” rating and set a $13.00 price target on shares of Cars.com in a research report on Monday, April 13th. Zacks Research upgraded shares of Cars.com from a “strong sell” rating to a “hold” rating in a research report on Wednesday, April 15th. Finally, Weiss Ratings lowered shares of Cars.com from a “hold (c-)” rating to a “sell (d+)” rating in a research report on Wednesday, April 1st. Three research analysts have rated the stock with a Buy rating, four have issued a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat.com, Cars.com has a consensus rating of “Hold” and an average price target of $14.67.

About Cars.com

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.