CARGURUS INC (CARG) Stock Fundamental Analysis
NASDAQ:CARG - Nasdaq - US1417881091 - Common Stock - Currency: USD
Taking everything into account, CARG scores 7 out of 10 in our fundamental rating. CARG was compared to 70 industry peers in the Interactive Media & Services industry. Both the health and profitability get an excellent rating, making CARG a very profitable company, without any liquidiy or solvency issues. CARG has a decent growth rate and is not valued too expensively. These ratings would make CARG suitable for quality investing!
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.
In the past 5 years CARG always reported a positive cash flow from operatings.
1.2 Ratios
CARG has a Return On Assets of 5.66%. This is in the better half of the industry: CARG outperforms 75.71% of its industry peers.
CARG has a better Return On Equity (9.70%) than 81.43% of its industry peers.
CARG's Return On Invested Capital of 18.90% is amongst the best of the industry. CARG outperforms 88.57% of its industry peers.
CARG had an Average Return On Invested Capital over the past 3 years of 8.22%. This is below the industry average of 12.03%.
The last Return On Invested Capital (18.90%) for CARG is above the 3 year average (8.22%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.66% | ||
| ROE | 9.7% | ||
| ROIC | 18.9% |
ROA(3y)8.94%
ROA(5y)8.45%
ROE(3y)11.76%
ROE(5y)11.2%
ROIC(3y)8.22%
ROIC(5y)10.28%
1.3 Margins
Looking at the Profit Margin, with a value of 4.32%, CARG is in the better half of the industry, outperforming 65.71% of the companies in the same industry.
In the last couple of years the Profit Margin of CARG has declined.
With an excellent Operating Margin value of 19.47%, CARG belongs to the best of the industry, outperforming 84.29% of the companies in the same industry.
CARG's Operating Margin has improved in the last couple of years.
CARG has a Gross Margin of 85.58%. This is amongst the best in the industry. CARG outperforms 84.29% of its industry peers.
CARG's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.47% | ||
| PM (TTM) | 4.32% | ||
| GM | 85.58% |
OM growth 3Y4.04%
OM growth 5Y24.69%
PM growth 3YN/A
PM growth 5Y-19.96%
GM growth 3Y6.61%
GM growth 5Y-2.25%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so CARG is creating value.
CARG has less shares outstanding than it did 1 year ago.
The number of shares outstanding for CARG has been reduced compared to 5 years ago.
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 10.15. This indicates that CARG is financially healthy and has little risk of bankruptcy at the moment.
CARG has a better Altman-Z score (10.15) than 87.14% 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 | 10.15 |
ROIC/WACC2.02
WACC9.37%
2.3 Liquidity
CARG has a Current Ratio of 2.65. This indicates that CARG is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of CARG (2.65) is comparable to the rest of the industry.
CARG has a Quick Ratio of 2.64. This indicates that CARG is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.64, CARG is in line with its industry, outperforming 60.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.65 | ||
| Quick Ratio | 2.64 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 43.85% over the past year.
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 0.64% in the last year.
The Revenue has been growing by 8.72% on average over the past years. This is quite good.
EPS 1Y (TTM)43.85%
EPS 3Y3.73%
EPS 5Y26.69%
EPS Q2Q%43.75%
Revenue 1Y (TTM)0.64%
Revenue growth 3Y-2.04%
Revenue growth 5Y8.72%
Sales Q2Q%4.34%
3.2 Future
The Earnings Per Share is expected to grow by 29.13% on average over the next years. This is a very strong growth
CARG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.87% yearly.
EPS Next Y26.58%
EPS Next 2Y22.21%
EPS Next 3Y20.23%
EPS Next 5Y29.13%
Revenue Next Year4.51%
Revenue Next 2Y6.24%
Revenue Next 3Y6.67%
Revenue Next 5Y6.87%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 17.73, CARG is valued on the expensive side.
Based on the Price/Earnings ratio, CARG is valued a bit cheaper than 71.43% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.50, CARG is valued a bit cheaper.
With a Price/Forward Earnings ratio of 12.83, CARG is valued correctly.
CARG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CARG is cheaper than 75.71% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.44, CARG is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.73 | ||
| Fwd PE | 12.83 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CARG indicates a somewhat cheap valuation: CARG is cheaper than 67.14% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, CARG is valued a bit cheaper than 67.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.12 | ||
| EV/EBITDA | 15.68 |
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 a very decent profitability rating, which may justify a higher PE ratio.
CARG's earnings are expected to grow with 20.23% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.67
PEG (5Y)0.66
EPS Next 2Y22.21%
EPS Next 3Y20.23%
5. Dividend
5.1 Amount
CARG does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
33.16
-0.32 (-0.96%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryInteractive Media & Services
Earnings (Last)
Earnings (Next)
Inst Owners103.84%
Inst Owner Change0%
Ins Owners2.35%
Ins Owner Change-0.82%
Market Cap3.28B
Analysts81.05
Price Target39.97 (20.54%)
Short Float %4%
Short Ratio3.59
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.23%
Min EPS beat(2)3.76%
Max EPS beat(2)4.7%
EPS beat(4)4
Avg EPS beat(4)8.16%
Min EPS beat(4)3.76%
Max EPS beat(4)20.18%
EPS beat(8)8
Avg EPS beat(8)12.08%
EPS beat(12)11
Avg EPS beat(12)20.59%
EPS beat(16)15
Avg EPS beat(16)22.88%
Revenue beat(2)0
Avg Revenue beat(2)-3.11%
Min Revenue beat(2)-3.64%
Max Revenue beat(2)-2.58%
Revenue beat(4)1
Avg Revenue beat(4)-1.38%
Min Revenue beat(4)-3.64%
Max Revenue beat(4)1.47%
Revenue beat(8)2
Avg Revenue beat(8)-0.86%
Revenue beat(12)3
Avg Revenue beat(12)-0.66%
Revenue beat(16)7
Avg Revenue beat(16)1.76%
PT rev (1m)5.19%
PT rev (3m)1.37%
EPS NQ rev (1m)5.76%
EPS NQ rev (3m)21.76%
EPS NY rev (1m)3.99%
EPS NY rev (3m)13.13%
Revenue NQ rev (1m)-0.41%
Revenue NQ rev (3m)-0.67%
Revenue NY rev (1m)-0.51%
Revenue NY rev (3m)-1.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.73 | ||
| Fwd PE | 12.83 | ||
| P/S | 3.63 | ||
| P/FCF | 16.12 | ||
| P/OCF | 12.1 | ||
| P/B | 8.15 | ||
| P/tB | 9.53 | ||
| EV/EBITDA | 15.68 |
EPS(TTM)1.87
EY5.64%
EPS(NY)2.58
Fwd EY7.79%
FCF(TTM)2.06
FCFY6.2%
OCF(TTM)2.74
OCFY8.27%
SpS9.14
BVpS4.07
TBVpS3.48
PEG (NY)0.67
PEG (5Y)0.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.66% | ||
| ROE | 9.7% | ||
| ROCE | 29.63% | ||
| ROIC | 18.9% | ||
| ROICexc | 26.65% | ||
| ROICexgc | 30.91% | ||
| OM | 19.47% | ||
| PM (TTM) | 4.32% | ||
| GM | 85.58% | ||
| FCFM | 22.5% |
ROA(3y)8.94%
ROA(5y)8.45%
ROE(3y)11.76%
ROE(5y)11.2%
ROIC(3y)8.22%
ROIC(5y)10.28%
ROICexc(3y)15.65%
ROICexc(5y)22.27%
ROICexgc(3y)26.83%
ROICexgc(5y)37.54%
ROCE(3y)12.88%
ROCE(5y)16.12%
ROICexcg growth 3Y-17.41%
ROICexcg growth 5Y9.83%
ROICexc growth 3Y2.8%
ROICexc growth 5Y9.66%
OM growth 3Y4.04%
OM growth 5Y24.69%
PM growth 3YN/A
PM growth 5Y-19.96%
GM growth 3Y6.61%
GM growth 5Y-2.25%
F-Score8
Asset Turnover1.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 280.97% | ||
| Cap/Sales | 7.48% | ||
| Interest Coverage | 266.67 | ||
| Cash Conversion | 135.45% | ||
| Profit Quality | 521.46% | ||
| Current Ratio | 2.65 | ||
| Quick Ratio | 2.64 | ||
| Altman-Z | 10.15 |
F-Score8
WACC9.37%
ROIC/WACC2.02
Cap/Depr(3y)166.54%
Cap/Depr(5y)120.06%
Cap/Sales(3y)5.35%
Cap/Sales(5y)3.77%
Profit Quality(3y)386.95%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)43.85%
EPS 3Y3.73%
EPS 5Y26.69%
EPS Q2Q%43.75%
EPS Next Y26.58%
EPS Next 2Y22.21%
EPS Next 3Y20.23%
EPS Next 5Y29.13%
Revenue 1Y (TTM)0.64%
Revenue growth 3Y-2.04%
Revenue growth 5Y8.72%
Sales Q2Q%4.34%
Revenue Next Year4.51%
Revenue Next 2Y6.24%
Revenue Next 3Y6.67%
Revenue Next 5Y6.87%
EBIT growth 1Y295.2%
EBIT growth 3Y1.92%
EBIT growth 5Y35.56%
EBIT Next Year30.68%
EBIT Next 3Y18.43%
EBIT Next 5Y18.78%
FCF growth 1Y-3.06%
FCF growth 3Y24.02%
FCF growth 5Y23.56%
OCF growth 1Y18.19%
OCF growth 3Y37.4%
OCF growth 5Y29.47%