Providing an online marketplace that connects buyers and sellers of new and used cars, CarGurus CARG increased profitability may be catching investors attention.

Furthermore, CarGurus belongs to the Zacks Automotive-Replacement Parts Industry which is currently in the top 9% of almost 250 Zacks industries.

Benefiting from its strong business industry, earnings estimate revisions are nicely up for CarGurus landing its stock a Zacks Rank #1 (Strong Buy) and the Bull of the Day.

Strong Financial Performance

CarGurus stock has soared over +50% in 2024 with the company now reaching or exceeding the Zacks EPS Consensus for nine consecutive quarters. Notably, CarGurus has attributed its customer-centric focus as the major catalyst to its improved financial performance.  

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Operational Efficiency

Seeing a sharp increase in its core marketplace revenue, CarGurus has leveraged its cost base to drive operating efficiencies. Annual earnings are now expected to increase 34% in fiscal 2024 to $1.66 per share versus EPS of $1.23 last year. Plus, FY25 EPS is projected to expand another 15%. More intriguing is that FY24 and FY25 EPS estimates are nicely up over the last 60 days.  

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Share Repurchase Program

Further boosting investor sentiment, CarGurus’ board of directors have authorized a $200 million share repurchase plan for FY25. This should further support the stock price of CARG with the Average Zacks Price Target of $39.29 a share still suggesting 7% upside from current levels.

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Bottom Line

It’s hard to overlook CarGurus stock going into 2025 with CARG having an “A” Zacks Style Scores grade for Growth in addition to its strong buy rating. 

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