CarGurus skids after mixed Q4 results, downbeat rev outlook

CarGurus

21/02/2025 15:38

** Shares of online auto marketplace CarGurus  CARG.O  skidding
19.1% to $30.42, an over three month-low, early Fri after mixed
qtrly report, downbeat current-qtr rev guidance
    ** Shares on course for biggest daily pct drop since Aug 9,
2022
** Boston-based firm late Thurs posted Q4 total rev of $228.5
mln, up 2% y/y, and non-GAAP EPS of 55 cents. Analysts on avg
expected total rev of $232.5 mln and profit of 52 cents, per
LSEG data
    ** Co said its Marketplace business achieved double-digit
growth, driven by continued migration to premium tiers, strong
OEM advertising demand, growing adoption
    ** For Q1, it expects total rev of $216-$236 mln, comprising
Marketplace rev of $209-$214 mln, and non-GAAP earnings of 41-47
cents
    ** Wall Street expected total rev of ~$236 mln and profit of
42 cents for the Mar-qtr
    ** DA Davidson sticks with 'neutral' rating, saying
Marketplace rev growth in 2025 expected to "modestly taper" as
comps toughen
    ** BTIG, which has 'buy' on the stock, lowered its PT by $1
to $40, saying CarOffer continues to be a waiting game as
management described the business turnaround as still "in the
early innings"
    ** JP Morgan increased its PT by $2 to $42
    ** Of 14 brokerages covering CARG, recommendation breakdown
is 10 "strong buy" or "buy", 3 "hold" and 1 "sell" with $40
median PT - LSEG
    ** Including the drop on Fri, stock still up ~30% over the
past year

(Lance Tupper is a Reuters market analyst. The views expressed
are his own)
((lance.tupper@tr.com 1-646-279-6380))