CarGurus (NASDAQ:CARG) Announces Quarterly Earnings Results

CarGurus (NASDAQ:CARG) issued its quarterly earnings results on Thursday. The company reported $0.66 EPS for the quarter, beating analysts’ consensus estimates of $0.61 by $0.05, FiscalAI reports. The business had revenue of $250.97 million for the quarter, compared to analysts’ expectations of $249.85 million. CarGurus had a net margin of 18.06% and a return on equity of 59.79%. The business’s quarterly revenue was up 7.2% on a year-over-year basis. During the same period last year, the business earned $0.57 earnings per share. CarGurus updated its Q3 2026 guidance to 0.630-0.690 EPS.

Here are the key takeaways from CarGurus’ conference call:

• Second-quarter results exceeded expectations: Revenue grew 13% year over year to $251 million, adjusted EBITDA rose 7% to $85 million, and free cash flow reached $88 million, representing 103% conversion of adjusted EBITDA.
• Dealers remained cautious about incremental spending amid margin pressure, lower days on lot, cost-cutting efforts, and FTC-mandated all-in pricing transparency. CarGurus reiterated its 2026 revenue growth outlook but expects a more measured pace of dealer decision-making in the third quarter.
• AI-driven products are increasing engagement and expanding CarGurus beyond its marketplace. Dealer platform sessions rose 28% year over year, PriceVantage bookings increased more than 50% sequentially, and Guru-driven U.S. leads rose 60% sequentially.
• Greater AI-enabled productivity and operating discipline led the company to raise its full-year profitability outlook, with adjusted EBITDA margin now expected to compress only 50–150 basis points versus 2025. CarGurus also repurchased $29 million of shares in the quarter and has $46 million remaining under its 2026 authorization.

CarGurus Price Performance

CARG traded up $2.61 during trading on Friday, hitting $38.99. 2,180,161 shares of the stock traded hands, compared to its average volume of 1,018,019. CarGurus has a 12-month low of $26.39 and a 12-month high of $41.22. The firm has a market capitalization of $3.52 billion, a P/E ratio of 21.19, a price-to-earnings-growth ratio of 1.33 and a beta of 1.17. The firm has a 50-day moving average of $32.85 and a 200 day moving average of $32.65.

Insider Buying and Selling

In other CarGurus news, General Counsel Javier Zamora sold 8,072 shares of the firm’s stock in a transaction dated Monday, June 1st. The shares were sold at an average price of $29.53, for a total value of $238,366.16. Following the completion of the sale, the general counsel directly owned 103,061 shares in the company, valued at $3,043,391.33. This trade represents a 7.26% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at this link. Also, insider Jennifer Ladd Hanson sold 2,499 shares of CarGurus stock in a transaction that occurred on Wednesday, July 1st. The shares were sold at an average price of $34.56, for a total value of $86,365.44. Following the sale, the insider directly owned 92,894 shares in the company, valued at approximately $3,210,416.64. The trade was a 2.62% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 31,764 shares of company stock valued at $1,071,649 over the last three months. Corporate insiders own 18.19% of the company’s stock.

Institutional Trading of CarGurus

Hedge funds and other institutional investors have recently modified their holdings of the business. Brown Brothers Harriman & Co. purchased a new position in shares of CarGurus during the third quarter valued at approximately $46,000. EverSource Wealth Advisors LLC increased its position in CarGurus by 491.7% during the 2nd quarter. EverSource Wealth Advisors LLC now owns 1,639 shares of the company’s stock valued at $55,000 after buying an additional 1,362 shares in the last quarter. Quantbot Technologies LP bought a new position in CarGurus during the 2nd quarter valued at approximately $87,000. Parkside Financial Bank & Trust raised its stake in CarGurus by 48.0% during the fourth quarter. Parkside Financial Bank & Trust now owns 3,018 shares of the company’s stock valued at $116,000 after buying an additional 979 shares during the last quarter. Finally, Quadrant Capital Group LLC bought a new position in CarGurus in the 3rd quarter worth about $148,000. 86.90% of the stock is owned by hedge funds and other institutional investors.

CarGurus News Summary

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.

Analysts Set New Price Targets

A number of brokerages have recently weighed in on CARG. Barclays upped their price objective on shares of CarGurus from $35.00 to $40.00 and gave the company an “overweight” rating in a research note on Tuesday, July 21st. BTIG Research lifted their target price on shares of CarGurus from $40.00 to $41.00 and gave the stock a “buy” rating in a research report on Friday. Needham & Company LLC boosted their price target on shares of CarGurus from $43.00 to $44.00 and gave the stock a “buy” rating in a research note on Friday. Weiss Ratings downgraded CarGurus from a “hold (c+)” rating to a “hold (c)” rating in a report on Wednesday, May 13th. Finally, JPMorgan Chase & Co. boosted their target price on CarGurus from $36.00 to $38.00 and gave the company a “neutral” rating in a research note on Friday, May 8th. One analyst has rated the stock with a Strong Buy rating, eight have issued a Buy rating and six have given a Hold rating to the company’s stock. According to MarketBeat.com, CarGurus presently has a consensus rating of “Moderate Buy” and a consensus target price of $40.25.

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.