Bear of the Day: Cars.com (CARS)

Zacks

15 Apr

With higher tariffs on imported vehicles likely to raise the cost of new and used cars, Cars.com’s CARS stock has plummeted more than 30% this year.

Trading near its 52-week low of $9 a share, there could be more downside risk for the Chicago-based online automotive platform, which offers research tools for new and used vehicle listings.

To that point, the lingering supply chain effects of the pandemic combined with higher tariffs have reduced the availability of used cars, with there being fewer trade-ins and off-lease vehicles.

Image Source: Zacks Investment Research

Declining EPS Revisions

On the surface, Cars.com’s EPS growth may be luring with annual earnings expected to rise 14% this year and projected to increase another 22% in fiscal 2026 to $2.40 per share. However, it’s noteworthy that FY25 and FY26 EPS estimates have declined over 12% and 7% in the last 60 days respectively.

Image Source: Zacks Investment Research

Lower Investor Sentiment

Leading to lower investment sentiment for Cars.com’s stock is that the company has missed earnings expectations for six consecutive quarters with an average EPS surprise of -29.81% in its last four quarterly reports. Notably, Cars.com has missed sales estimates in two of the last four quarters.

Image Source: Zacks Investment Research

Increased Competition & Slower Sales Growth

Although Cars.com has gained much notoriety since becoming independent and going public in 2017, the company has yet to reach a billion dollars in annual sales.

Historically low inventory levels and higher vehicle prices have weighed on Cars.com’s revenue growth as consumer demand continues to plunge.

Image Source: Zacks Investment Research

Furthermore, Cars.com has faced increased competition in the automotive marketplace from rivals like Autotrader ATDRY, CarGurus CARR, and CarMax KMX along with Carvana CVNA, which is expected to bring in over $20 billion in annual sales by FY26.

Image Source: Zacks Investment Research

Bottom Line

Increased competition has added to macroeconomic concerns, landing Cars.com stock a Zacks Rank #5 (Strong Sell) and the Bear of the Day. While it may be too soon to call Cars.com's stock a value trap, there appears to be more downside risk ahead and investors may want to be cautious even with CARS trading at just 5.7X forward earnings.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Cars.com Inc. (CARS) : Free Stock Analysis Report

CarMax, Inc. (KMX) : Free Stock Analysis Report

Carvana Co. (CVNA) : Free Stock Analysis Report

Auto Trader Group (ATDRY) : Free Stock Analysis Report

Carrier Global Corporation (CARR) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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One of the best stock trading platforms in Singapore.","ogImage":"https://c1.itigergrowtha.com/portal5/static/media/og-logo.be62fbe1.png","ogUrl":"https://www-web.itiger.com/news/2527646977"},"companyName":"Tiger Brokers"},"pageData":{"isMobile":false,"isTiger":false,"isTTM":true,"region":"SGP","license":"TBSG","edition":"fundamental"},"__swrFallback__":{"@#url:\"https://stock-news.skytigris.cn/v3/news\",params:#id:\"2527646977\",edition:\"fundamental\",,,undefined,":{"share":"https://ttm.financial/m/news/2527646977?lang=en_US&edition=fundamental","thumbnail":"","is_english":true,"pubTime":"2025-04-15 16:00","share_image_url":"https://static.laohu8.com/5f26f4a48f9cb3e29be4d71d3ba8c038","id":"2527646977","market":"us","top_or_hot":-1,"title":"Bear of the Day: Cars.com (CARS)","media":"Zacks","content":"<html><body><p><span><span>With higher tariffs on imported vehicles likely to raise the cost of new and used cars, Cars.com’s CARS</span></span><span><span> stock has plummeted more than 30% this year.</span></span></p>\n<p><span><span>Trading near its 52-week low of $9 a share, there could be more downside risk for the Chicago-based online automotive platform, which offers research tools for new and used vehicle listings. </span></span></p>\n<p><span><span>To that point, the lingering supply chain effects of the pandemic combined with higher tariffs have reduced the availability of used cars, with there being fewer trade-ins and off-lease vehicles.</span></span><span> </span></p>\n<p><img src=\"https://s.yimg.com/uu/api/res/1.2/t8dvCgZ8m3Iwn9SvQNtU6A--/cT03NTthcHBpZD15dmlkZW9mZWVkczs-/https://media.zenfs.com/en/zacks.com/618b69d9b03a0aafc9da8c957addf8e6\"/><br/><span>Image Source: Zacks Investment Research</span><br/></p>\n<h2><span><span><strong>Declining EPS Revisions </strong></span></span></h2>\n<p><span><span>On the surface, Cars.com’s EPS growth may be luring with annual earnings expected to rise 14% this year and projected to increase another 22% in fiscal 2026 to $2.40 per share. However, it’s noteworthy that FY25 and FY26 EPS estimates have declined over 12% and 7% in the last 60 days respectively.</span></span></p>\n<p><img src=\"https://s1.yimg.com/uu/api/res/1.2/YyWgsMNBi2qXZiH7WQ9esQ--/cT03NTthcHBpZD15dmlkZW9mZWVkczs-/https://media.zenfs.com/en/zacks.com/3b2ee2f1803f1d51668b46fe67d31e0b\"/><br/><span>Image Source: Zacks Investment Research</span><br/></p>\n<h2><span><span><strong>Lower Investor Sentiment</strong></span></span></h2>\n<p><span><span>Leading to lower investment sentiment for Cars.com’s stock is that the company has missed earnings expectations for six consecutive quarters with an average EPS surprise of -29.81% in its last four quarterly reports. Notably, Cars.com has missed sales estimates in two of the last four quarters.</span></span></p>\n<p><img src=\"https://s.yimg.com/uu/api/res/1.2/s7yLutVpBuFXSyQKKcooxQ--/cT03NTthcHBpZD15dmlkZW9mZWVkczs-/https://media.zenfs.com/en/zacks.com/91b59e3b4037db525d8e651893ee17f1\"/><br/><span>Image Source: Zacks Investment Research</span><br/></p>\n<h2><span><span><strong>Increased Competition &amp; Slower Sales Growth </strong></span></span></h2>\n<p><span><span>Although Cars.com has gained much notoriety since becoming independent and going public in 2017, the company has yet to reach a billion dollars in annual sales.</span></span></p>\n<p><span>Historically low inventory levels and higher vehicle prices have weighed on Cars.com’s revenue growth as consumer demand continues to plunge. </span></p>\n<p><img src=\"https://s.yimg.com/uu/api/res/1.2/_TmJh9OCutBjTKtMVJFSRg--/cT03NTthcHBpZD15dmlkZW9mZWVkczs-/https://media.zenfs.com/en/zacks.com/9569fa0aae24cb1cc837013388c110d7\"/><br/><span>Image Source: Zacks Investment Research</span><br/></p>\n<p><span><span>Furthermore, Cars.com has faced increased competition in the automotive marketplace from rivals like Autotrader ATDRY</span></span><span><span>, CarGurus CARR</span></span><span><span>, and CarMax KMX</span></span><span><span> along with Carvana CVNA</span></span><span><span>, which is expected to bring in over $20 billion in annual sales by FY26.</span></span></p>\n<p><img src=\"https://s1.yimg.com/uu/api/res/1.2/2hk9NXpuTd8galNWUYjugA--/cT03NTthcHBpZD15dmlkZW9mZWVkczs-/https://media.zenfs.com/en/zacks.com/3a4af5c8fc015a336011027981389706\"/><br/><span>Image Source: Zacks Investment Research</span><br/></p>\n<h2><span><span><strong>Bottom Line </strong></span></span></h2>\n<p><span>Increased competition has added to macroeconomic concerns, landing Cars.com stock a Zacks Rank #5 (Strong Sell) and the Bear of the Day. </span><span>While it may be too soon to call Cars.com's stock a value trap, there appears to be more downside risk ahead and investors may want to be cautious even with CARS trading at just 5.7X forward earnings. </span></p>\n<p>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report</p>\n<p><a href=\"https://laohu8.com/S/CARS\">Cars.com Inc.</a> (CARS) : Free Stock Analysis Report</p>\n<p>CarMax, Inc. (KMX) : Free Stock Analysis Report</p>\n<p><a href=\"https://laohu8.com/S/CVNA\">Carvana Co.</a> (CVNA) : Free Stock Analysis Report</p>\n<p>Auto Trader Group (ATDRY) : Free Stock Analysis Report</p>\n<p>Carrier Global Corporation (CARR) : Free Stock Analysis Report</p>\n<p>This article originally published on Zacks Investment Research (zacks.com).</p>\n<p>Zacks Investment Research</p></body></html>","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Bear of the Day: Cars.com (CARS)</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; 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Notably, Cars.com has missed sales estimates in two of the last four quarters.Furthermore, Cars.com has faced increased competition in the automotive marketplace from rivals like Autotrader ATDRY, CarGurus CARR, and CarMax KMXalong with Carvana CVNA, ","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{},"translate_title":"今日熊：Cars.com(CARS)","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ATDRY":1,"CARR":1,"CARS":1,"CVNA":1,"KMX":1},"content_text":"With higher tariffs on imported vehicles likely to raise the cost of new and used cars, Cars.com’s CARS stock has plummeted more than 30% this year.\nTrading near its 52-week low of $9 a share, there could be more downside risk for the Chicago-based online automotive platform, which offers research tools for new and used vehicle listings. \nTo that point, the lingering supply chain effects of the pandemic combined with higher tariffs have reduced the availability of used cars, with there being fewer trade-ins and off-lease vehicles. \nImage Source: Zacks Investment Research\nDeclining EPS Revisions \nOn the surface, Cars.com’s EPS growth may be luring with annual earnings expected to rise 14% this year and projected to increase another 22% in fiscal 2026 to $2.40 per share. However, it’s noteworthy that FY25 and FY26 EPS estimates have declined over 12% and 7% in the last 60 days respectively.\nImage Source: Zacks Investment Research\nLower Investor Sentiment\nLeading to lower investment sentiment for Cars.com’s stock is that the company has missed earnings expectations for six consecutive quarters with an average EPS surprise of -29.81% in its last four quarterly reports. Notably, Cars.com has missed sales estimates in two of the last four quarters.\nImage Source: Zacks Investment Research\nIncreased Competition & Slower Sales Growth \nAlthough Cars.com has gained much notoriety since becoming independent and going public in 2017, the company has yet to reach a billion dollars in annual sales.\nHistorically low inventory levels and higher vehicle prices have weighed on Cars.com’s revenue growth as consumer demand continues to plunge. \nImage Source: Zacks Investment Research\nFurthermore, Cars.com has faced increased competition in the automotive marketplace from rivals like Autotrader ATDRY, CarGurus CARR, and CarMax KMX along with Carvana CVNA, which is expected to bring in over $20 billion in annual sales by FY26.\nImage Source: Zacks Investment Research\nBottom Line \nIncreased competition has added to macroeconomic concerns, landing Cars.com stock a Zacks Rank #5 (Strong Sell) and the Bear of the Day. While it may be too soon to call Cars.com's stock a value trap, there appears to be more downside risk ahead and investors may want to be cautious even with CARS trading at just 5.7X forward earnings. \nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nCars.com Inc. (CARS) : Free Stock Analysis Report\nCarMax, Inc. (KMX) : Free Stock Analysis Report\nCarvana Co. (CVNA) : Free Stock Analysis Report\nAuto Trader Group (ATDRY) : Free Stock Analysis Report\nCarrier Global Corporation (CARR) : Free Stock Analysis Report\nThis article originally published on Zacks Investment Research (zacks.com).\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1,"code":"91000000","status":"200"}}}