CarGurus , Inc. (NASDAQ:CARG) Chief Operating Officer and President, Samuel Zales, has recently sold shares of the company, according to a recent SEC filing. On October 16, Zales sold 25,168 shares of CarGurus' Class A common stock at a weighted average price of $31.62, amounting to a total transaction value of approximately $795,812. This transaction was conducted under a pre-arranged Rule 10b5-1 trading plan.
In addition to the sale, Zales also exercised stock options to acquire 17,668 shares of Class A common stock at a price of $0.16 per share, which were converted from Class B common stock. Following these transactions, Zales now holds 449,821 shares of CarGurus' Class A common stock.
In other recent news, CarGurus Inc. has been the subject of several analyst upgrades following strong quarterly results. RBC Capital Markets raised its price target for the company to $30, maintaining an Outperform rating, while Needham increased its target to $27, noting CarGurus' strategy of upselling products and focusing on larger dealerships. Additionally, BTIG updated its price target for CarGurus to $30, citing the company's marketplace revenue surpassing its guidance.
Despite a 9% decrease in consolidated revenue to $219 million, CarGurus reported a 14% year-over-year growth in its marketplace business in the second quarter of 2024. This growth was driven by higher subscription tiers and the adoption of add-on products. The company's international business also saw a 21% increase in revenue.
CarGurus is working on enhancing the consumer experience through its mobile app and AI, and is developing an end-to-end transaction-enabled platform. Despite a non-cash goodwill impairment charge of $127 million related to its CarOffer business, the company remains optimistic about its restructuring efforts and the integration of retail and wholesale capabilities. These are among the recent developments that have led to increased confidence from analysts and a positive outlook for the company's future.
InvestingPro Insights
While CarGurus' COO Samuel Zales has recently sold a portion of his shares, it's important to consider this transaction within the broader context of the company's financial health and market performance. According to InvestingPro data, CarGurus boasts a market capitalization of $3.25 billion, reflecting its significant presence in the online automotive marketplace.
One of the InvestingPro Tips highlights that management has been aggressively buying back shares, which could be seen as a vote of confidence in the company's future prospects. This is particularly noteworthy given that CarGurus holds more cash than debt on its balance sheet, indicating a strong financial position.
The company's stock has shown remarkable performance, with a 75.99% price total return over the past year. This aligns with another InvestingPro Tip suggesting a high shareholder yield. Currently trading at $31.45, close to its 52-week high, CarGurus' stock price is reflecting investor optimism.
It's worth noting that while the company wasn't profitable over the last twelve months, analysts predict profitability this year. This expectation, combined with the company's strong revenue of $877.03 million in the last twelve months and a robust gross profit margin of 78.67%, paints a picture of potential growth ahead.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for CarGurus, providing deeper insights into the company's financial health and market position.
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