CarGurus shares in reverse after guidance disappoints

CarGurus

09/08/2022 19:01

** Shares in online platform for buying, selling cars CarGurus
Inc  CARG.O  down 23.3% after quarterly report and weaker than
expected Q3 guidance; multiple analysts cut price targets  
    ** CARG Q2 adj. EPS of $0.32 compares with consensus
expectation for $0.31 on rev of $511.23 mln vs Street view of
$505.85 mln, according to Refinitiv
    ** However, the co forecast current quarter sequential EPS
dip to a range of $0.25-$0.28 and rev drop to a range of $460
mln to $490 mln. Sees non-GAAP consolidated adj. EBITDA of $44.5
mln to $52.5 mln  urn:newsml:reuters.com:*:nGNX8Zkpt7
    ** Says assumptions on pace of paid dealer acquisition,
churn, expansion in guidance based on recent market behaviors,
industry conditions
    ** For Q3 weakness, DADCO analyst Tom White, who cut his PT
on the stock $4 to $30, cited declining consumer purchase demand
due to inflation/macroeconomy putting pressure on wholesale
industry activity. He also saw moderation in rental fleet
activity relative to the past few quarters
    ** After the report, at least 9 analysts cut their CARG PT,
with RBC cutting to $35 from $45, Benchmark cutting target to
$37 from $50, Oppenheimer cutting to $32 from $38, Truist
cutting to $38 from $44
    ** After hitting lowest level since November 2020, CARG last
at $19.73 vs median PT of $32, vs July 9 median PT of $36.50,
according to Refinitiv. 14 analyst ratings: 5 'strong buy,' 6
'buy,' 3 'hold' 

 (Reporting By Sinéad Carew)
 ((sinead.carew@thomsonreuters.com;))