CarGurus Inc. Class A Common Stock (CARG)

FairStock Score: 60/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for businesses whose earnings and cash flow can be understood and trusted. CarGurus is an online automotive marketplace: shoppers attract dealers, dealers attract shoppers, and the company collects subscription and advertising fees. That network can be a modest moat, though not an unbreakable one. The filed numbers show the improvement: in fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $251.0M and net income was $49.2M, or diluted EPS $0.54. In fiscal Q1 2026, the quarter ended 2026-03-31, net income was $32.2M. For FY2025, the year ended 2025-12-31, revenue was $907.0M and net income was $155.9M, versus FY2024 revenue of $798.0M and net income of $21.0M. FairStock calculates a 53.47% return on equity, 25.02% return on capital, a Piotroski score of 7/9, and an Altman Z-score of 7.19, so the balance sheet appears sturdy. Trailing free cash flow is $291.3M, a 10.9% free cash flow yield on a $2.7B market cap. At the 2026-10-13 close of $29.32, FairStock calculates a P/E of 15.11, EV/EBITDA of 9.18, and PEG of 0.13. Those are not demanding if growth persists. But P/B is 11.11 and the Graham Number is $11.37, a -157.87% margin of safety, so asset-based value offers no support. In Lynch terms it is a STALWART, with 15.0% profit growth and 10.5% revenue growth over five years. I see a good business at a fair-to-full price, not a bargain.

In plain English: CarGurus runs an online car-shopping marketplace where dealers and advertisers pay to reach vehicle buyers. The business looks financially strong: recent quarters show rising revenue and much higher profit, and it turns a lot of revenue into cash. At the recent price, the shares look reasonable based on earnings and cash flow, but they are not cheap compared with what the company's books say it is worth.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q4 2025 10-K (period ended 2025-12-31) · fiscal Q3 2025 10-K (period ended 2025-09-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer