We assign a fundamental rating of 7 out of 10 to CARG. CARG was compared to 70 industry peers in the Interactive Media & Services industry. CARG has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. CARG may be a bit undervalued, certainly considering the very reasonable score on growth With these ratings, CARG could be worth investigating further for value and quality investing!.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

CARG had positive earnings in the past year.
In the past year CARG had a positive cash flow from operations.
CARG had positive earnings in 4 of the past 5 years.
CARG had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

The Return On Assets of CARG (23.01%) is better than 92.86% of its industry peers.
The Return On Equity of CARG (40.48%) is better than 98.57% of its industry peers.
Looking at the Return On Invested Capital, with a value of 23.46%, CARG belongs to the top of the industry, outperforming 88.57% of the companies in the same industry.
CARG had an Average Return On Invested Capital over the past 3 years of 8.25%. This is significantly below the industry average of 13.70%.
The 3 year average ROIC (8.25%) for CARG is below the current ROIC(23.46%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	23.01%
ROE	40.48%
ROIC	23.46%

ROA(3y)8.94%

ROA(5y)8.45%

ROE(3y)11.77%

ROE(5y)11.21%

ROIC(3y)8.25%

ROIC(5y)10.3%

1.3 Margins

CARG has a Profit Margin of 16.41%. This is amongst the best in the industry. CARG outperforms 82.86% of its industry peers.
In the last couple of years the Profit Margin of CARG has declined.
CARG has a Operating Margin of 22.47%. This is amongst the best in the industry. CARG outperforms 87.14% of its industry peers.
In the last couple of years the Operating Margin of CARG has grown nicely.
The Gross Margin of CARG (88.15%) is better than 88.57% of its industry peers.
CARG's Gross Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	22.47%
PM (TTM)	16.41%
GM	88.15%

OM growth 3Y4.23%

OM growth 5Y24.82%

PM growth 3YN/A

PM growth 5Y-19.98%

GM growth 3Y6.61%

GM growth 5Y-2.25%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CARG is creating value.
Compared to 1 year ago, CARG has less shares outstanding
Compared to 5 years ago, CARG has less shares outstanding
There is no outstanding debt for CARG. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

2.2 Solvency

CARG has an Altman-Z score of 10.36. This indicates that CARG is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of CARG (10.36) is better than 90.00% of its industry peers.
CARG has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	0
Altman-Z	10.36

ROIC/WACC2.64

WACC8.88%

2.3 Liquidity

A Current Ratio of 2.87 indicates that CARG has no problem at all paying its short term obligations.
CARG has a better Current ratio (2.87) than 74.29% of its industry peers.
CARG has a Quick Ratio of 2.87. This indicates that CARG is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of CARG (2.87) is better than 74.29% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.87
Quick Ratio	2.87

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

CARG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 41.18%, which is quite impressive.
CARG shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 26.69% yearly.
Looking at the last year, CARG shows a small growth in Revenue. The Revenue has grown by 4.21% in the last year.
CARG shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.72% yearly.

EPS 1Y (TTM)41.18%

EPS 3Y3.73%

EPS 5Y26.69%

EPS Q2Q%28.89%

Revenue 1Y (TTM)4.21%

Revenue growth 3Y-2.04%

Revenue growth 5Y8.72%

Sales Q2Q%3.17%

3.2 Future

CARG is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 21.55% yearly.
The Revenue is expected to grow by 5.88% on average over the next years.

EPS Next Y30.89%

EPS Next 2Y22.71%

EPS Next 3Y21.74%

EPS Next 5Y21.55%

Revenue Next Year4.32%

Revenue Next 2Y5.21%

Revenue Next 3Y6.09%

Revenue Next 5Y5.88%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 15.47 indicates a correct valuation of CARG.
CARG's Price/Earnings ratio is a bit cheaper when compared to the industry. CARG is cheaper than 71.43% of the companies in the same industry.
CARG's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.60.
CARG is valuated correctly with a Price/Forward Earnings ratio of 12.83.
Based on the Price/Forward Earnings ratio, CARG is valued a bit cheaper than 67.14% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.83, CARG is valued rather cheaply.

		Industry Rank	Sector Rank
PE	15.47
Fwd PE	12.83

4.2 Price Multiples

CARG's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CARG is cheaper than 67.14% of the companies in the same industry.
CARG's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. CARG is cheaper than 77.14% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	12.68
EV/EBITDA	12.98

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
CARG has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as CARG's earnings are expected to grow with 21.74% in the coming years.