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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#732
Positioning
Market Dominance
Services
Business Services
$3.7B
Jason Trevisan
CarGurus, Inc. operates an online automotive marketplace connecting buyers and sellers of new and used cars in the United States and internationally. Its marketplace connects dealers to a large audience of informed and engaged consumers. The company operates online marketplaces in Canada and the United Kingdom; Autolist and PistonHeads are independent brands.
Headcount
1.2K
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = CARG ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$YALA Yalla Group Ltd | 75 | 89 | 99 | 80 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$GRVY GRAVITY Co., Ltd. | 75 | 82 | 96 | 71 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ISSC INNOVATIVE SOLUTIONS & SUPPORT INC | 73 | 81 | 88 | 94 | 25.0x | 14.1x | 17.1% | 10.3% | 35.5% | 14.6% | 10.1% | 105.2% | 0.0% | 41.0x | $244M | VS | |
$AER AerCap Holdings N.V. | 72 | 60 | 87 | 84 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$HCSG HEALTHCARE SERVICES GROUP INC | 72 | 74 | 88 | 88 | 7.1x | 6.1x | 28.9% | 20.8% | 20.8% | 9.9% | 9.3% | 8.5% | 0.0% | 1.0x | $1.2B | VS | |
$LQDT LIQUIDITY SERVICES INC | 72 | 90 | 88 | 68 | 24.9x | 14.3x | 14.1% | 8.3% | 45.7% | 8.5% | 6.2% | 28.1% | 0.0% | 0.0x | $736M | VS | |
$TRTNpA Triton International Ltd | 71 | 70 | 89 | 70 | - | 1.7x | 0.0% | - | 97.4% | 58.0% | 37.4% | - | 8.8% | 264.0x | $2.5B | VS | |
$EDU New Oriental Education & Technology Group Inc. | 71 | 83 | 52 | 77 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$NTES NetEase, Inc. | 71 | 88 | 93 | 68 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$UTI UNIVERSAL TECHNICAL INSTITUTE INC | 70 | 86 | 86 | 72 | 43.2x | 16.0x | 15.3% | 5.8% | 100.0% | 6.9% | 5.2% | 15.1% | 0.0% | 24.0x | $1.8B | VS | |
$CARG CarGurus, Inc. | 60 | 87 | 68 | 54 | 22.4x | 17.1x | 34.4% | 19.4% | 89.4% | 17.1% | 14.4% | 5.9% | 0.0% | 0.0x | $3.7B | ||
| SECTOR BENCH | - | - | - | - | - | 23.7x | 11.7x | 5.7% | 2.4% | 64.6% | 4.5% | 2.8% | 8.6% | 0.0% | 0.3x | - | REF |
CarGurus, Inc. (CARG) receives a "Hold" rating with a composite score of 59.7/100. It ranks #732 out of 7,333 stocks in our coverage universe and carries a 3-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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HQ Base
Pending Verification
In-line with peers — no strong momentum signal
Trading at a discount to fundamentals — favorable entry valuation
High profitability & efficiency — strong quality floor supports entry
Low volatility — smoother ride and historically better risk-adjusted returns
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Services sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for CARG.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 87 | 99 | -12DRAG |
| MOMENTUM | 54 | 55 | -1NEUTRAL |
| VALUATION | 68 | 78 | -10DRAG |
| INVESTMENT | 31 | 36 | -5NEUTRAL |
| STABILITY | 67 | 72 | -5NEUTRAL |
| SHORT INT | 42 | 36 | +6ALPHA |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROE proxy 34.4% (sector 5.7%)
GM 89% vs sector 65%, OM 17% vs sector 5%
Capital turnover N/A, R&D intensity 15.2%
Rev growth 6%, 9yr history
Interest coverage N/A, Net debt/EBITDA -0.7x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate CarGurus, Inc. (CARG) as a Hold with a composite score of 59.7/100 at a current price of $28.98. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling.
CarGurus, Inc. holds a top-quartile position (#0 of 50) within the Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 59.7/100 places it at rank #732 in our full universe.
Narrow
Low
Exemplary
Undervalued
Gross margins of 89% signal strong pricing power.
Returns on equity of 34.4% exceed cost of capital.
Value factor score of 68 suggests attractive pricing.
Vulnerability to macroeconomic shocks and interest rate volatility.
CarGurus, Inc. represents a hold based on multi-factor quantitative performance.
Our model assigns CarGurus, Inc. a Hold rating, with a composite score of 59.7/100 and 3 out of 5 stars. Ranked #732 of 7,333 stocks, CARG presents a mixed quantitative picture — neither compelling enough to initiate new positions nor weak enough to warrant selling. Investors already holding may consider maintaining their position while monitoring for changes in the factor profile.
CarGurus, Inc. scores an outstanding 87/100 on our quality factor, placing it among the highest-quality companies in our coverage universe. The company reports a return on equity of 34.4% (sector avg: 5.7%), gross margins of 89.4% (sector avg: 64.6%), net margins of 14.4% (sector avg: 2.8%). This level of profitability and capital efficiency typically reflects a durable competitive advantage and disciplined management.
CARG's value score of 68/100 indicates the stock is fairly valued based on its current fundamentals. Key valuation metrics include a P/E ratio of 22.39x, an EV/EBITDA of 17.13x, a P/B ratio of 7.70x. At this level, neither a clear bargain nor overpriced, the stock's attractiveness depends more on forward growth expectations and qualitative factors.
CarGurus, Inc.'s investment score of 31/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 5.9% vs. a sector average of 8.6% and a return on assets of 19.4% (sector: 2.4%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
CARG demonstrates moderate momentum with a score of 54/100, suggesting a neutral price trend without strong directional conviction. Revenue growth stands at 5.9% year-over-year, while a beta of 1.10 reflects its sensitivity to broader market moves. Moderate momentum may indicate the stock is consolidating or transitioning between trends, warranting close monitoring of upcoming catalysts.
CARG shows good financial stability with a score of 67/100. Key stability metrics include a beta of 1.10 and a debt-to-equity ratio of 0.00x (sector avg: 0.3x). This suggests manageable leverage and moderate price volatility, making it appropriate for investors seeking a balance between growth potential and capital preservation.
The short interest score of 42/100 for CARG suggests somewhat elevated bearish positioning by institutional traders. With a $3.7B market cap (mid-cap), CarGurus, Inc. may experience above-average volatility. Investors should consider whether the short thesis has merit or if it creates a potential short-squeeze opportunity.
CarGurus, Inc. is a mid-cap company in the Services sector, ranked #0 of 50 in its sector (100th percentile) and #732 of 7,333 overall (90th percentile). Key comparisons include ROE of 34.4% exceeding the 5.7% sector median and operating margins of 17.1% above the 4.5% sector average. This top-quartile standing reflects exceptional competitive strength relative to Services peers.
While CARG currently exhibits a HOLD profile, superior opportunities exist within the SERVICES sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Services Alpha →Quant Factor Profile
Key factor gap
Quality (87) vs Investment (31) — closing this gap could shift the rating.
EV/EBITDA 46% ABOVE SECTOR MEDIAN
ROE 499% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 38% ABOVE SECTOR MEDIAN (FAVORABLE)
Above 50MA
37.18%
Net New Highs
+51081
CarGurus Inc. (NASDAQ:CARG) is one of the best stocks for beginners with little money in 2026. On February 19, CarGurus reported financial results for Q4 and the full year 2025. The full year was characterized by a 14% increase in annual revenue to $907 million, whereas quarterly revenue stood at $241.09 million and rose 5.49% […]
CarGurus, NasdaqGS:CARG, has authorized a new $250 million share repurchase program. The company is sharpening its focus on its core marketplace and international growth after winding down CarOffer. Management highlighted strong revenue, record retention, and faster dealer acquisition, including outside the US. CarGurus, trading at $27.86, sits at an interesting crossroads, with a 3-year return of 63.4% and a 5-year return of 5.5%. In the shorter term, the stock is down 18.1% over the past...
RBC Capital analyst Brad Erickson maintains CarGurus (NASDAQ:CARG) with a Outperform and lowers the price target from $40 to $34.
DA Davidson analyst Tom White maintains CarGurus (NASDAQ:CARG) with a Neutral and lowers the price target from $37.5 to $33.5.
CarGurus Q4 2025 results show revenue growth but a slight earnings miss. The company provides steady 2026 guidance and announces a new $250M stock buyback.