CARS.COM INC (CARS) Stock Fundamental Analysis
NYSE:CARS - New York Stock Exchange, Inc. - US14575E1055 - Common Stock - Currency: USD
CARS gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 71 industry peers in the Interactive Media & Services industry. CARS has an average financial health and profitability rating. CARS scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
In the past year CARS was profitable.
In the past year CARS had a positive cash flow from operations.
Of the past 5 years CARS 4 years were profitable.
CARS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of CARS (4.19%) is better than 71.83% of its industry peers.
The Return On Equity of CARS (9.27%) is better than 84.51% of its industry peers.
Looking at the Return On Invested Capital, with a value of 3.78%, CARS is in the better half of the industry, outperforming 69.01% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CARS is significantly below the industry average of 11.33%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.19% | ||
| ROE | 9.27% | ||
| ROIC | 3.78% |
ROA(3y)5.37%
ROA(5y)-11.23%
ROE(3y)12.65%
ROE(5y)-38.25%
ROIC(3y)4.71%
ROIC(5y)4.14%
1.3 Margins
CARS's Profit Margin of 6.32% is fine compared to the rest of the industry. CARS outperforms 74.65% of its industry peers.
CARS's Profit Margin has improved in the last couple of years.
CARS has a better Operating Margin (6.58%) than 69.01% of its industry peers.
In the last couple of years the Operating Margin of CARS has declined.
CARS has a Gross Margin of 66.62%. This is comparable to the rest of the industry: CARS outperforms 54.93% of its industry peers.
In the last couple of years the Gross Margin of CARS has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.58% | ||
| PM (TTM) | 6.32% | ||
| GM | 66.62% |
OM growth 3Y-2.2%
OM growth 5Y-2.9%
PM growth 3Y57%
PM growth 5YN/A
GM growth 3Y-1.18%
GM growth 5Y-1.8%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), CARS is destroying value.
The number of shares outstanding for CARS has been reduced compared to 1 year ago.
Compared to 5 years ago, CARS has less shares outstanding
Compared to 1 year ago, CARS has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.29, we must say that CARS is in the distress zone and has some risk of bankruptcy.
CARS's Altman-Z score of 0.29 is on the low side compared to the rest of the industry. CARS is outperformed by 67.61% of its industry peers.
The Debt to FCF ratio of CARS is 3.13, which is a good value as it means it would take CARS, 3.13 years of fcf income to pay off all of its debts.
CARS's Debt to FCF ratio of 3.13 is fine compared to the rest of the industry. CARS outperforms 63.38% of its industry peers.
CARS has a Debt/Equity ratio of 0.93. This is a neutral value indicating CARS is somewhat dependend on debt financing.
CARS's Debt to Equity ratio of 0.93 is on the low side compared to the rest of the industry. CARS is outperformed by 73.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | 3.13 | ||
| Altman-Z | 0.29 |
ROIC/WACC0.45
WACC8.46%
2.3 Liquidity
A Current Ratio of 1.65 indicates that CARS should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.65, CARS is in line with its industry, outperforming 40.85% of the companies in the same industry.
CARS has a Quick Ratio of 1.65. This is a normal value and indicates that CARS is financially healthy and should not expect problems in meeting its short term obligations.
CARS has a Quick ratio (1.65) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.65 | ||
| Quick Ratio | 1.65 |
3. Growth
3.1 Past
CARS shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -56.69%.
Measured over the past years, CARS shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -14.33% on average per year.
The Revenue has been growing slightly by 2.24% in the past year.
CARS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.46% yearly.
EPS 1Y (TTM)-56.69%
EPS 3Y-22.72%
EPS 5Y-14.33%
EPS Q2Q%-400%
Revenue 1Y (TTM)2.24%
Revenue growth 3Y4.86%
Revenue growth 5Y3.46%
Sales Q2Q%-0.64%
3.2 Future
Based on estimates for the next years, CARS will show a very strong growth in Earnings Per Share. The EPS will grow by 22.26% on average per year.
The Revenue is expected to grow by 3.05% on average over the next years.
EPS Next Y6.25%
EPS Next 2Y33.6%
EPS Next 3Y22.26%
EPS Next 5YN/A
Revenue Next Year1.26%
Revenue Next 2Y2.2%
Revenue Next 3Y2.54%
Revenue Next 5Y3.05%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.90 indicates a correct valuation of CARS.
Compared to the rest of the industry, the Price/Earnings ratio of CARS indicates a somewhat cheap valuation: CARS is cheaper than 73.24% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.03, CARS is valued a bit cheaper.
With a Price/Forward Earnings ratio of 7.88, the valuation of CARS can be described as very cheap.
85.92% of the companies in the same industry are more expensive than CARS, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.94. CARS is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.9 | ||
| Fwd PE | 7.88 |
4.2 Price Multiples
CARS's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. CARS is cheaper than 81.69% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CARS indicates a rather cheap valuation: CARS is cheaper than 95.77% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 4.43 | ||
| EV/EBITDA | 6.93 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of CARS may justify a higher PE ratio.
A more expensive valuation may be justified as CARS's earnings are expected to grow with 22.26% in the coming years.
PEG (NY)2.38
PEG (5Y)N/A
EPS Next 2Y33.6%
EPS Next 3Y22.26%
5. Dividend
5.1 Amount
CARS does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
10.13
-0.53 (-4.97%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryInteractive Media & Services
Earnings (Last)
Earnings (Next)
Inst Owners93.95%
Inst Owner Change-2.86%
Ins Owners2.65%
Ins Owner Change14.33%
Market Cap643.56M
Analysts78.46
Price Target18.87 (86.28%)
Short Float %6.37%
Short Ratio3.79
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-22.58%
Min EPS beat(2)-127.23%
Max EPS beat(2)82.07%
EPS beat(4)3
Avg EPS beat(4)103.55%
Min EPS beat(4)-127.23%
Max EPS beat(4)399.11%
EPS beat(8)4
Avg EPS beat(8)182.52%
EPS beat(12)7
Avg EPS beat(12)136.4%
EPS beat(16)9
Avg EPS beat(16)96.76%
Revenue beat(2)0
Avg Revenue beat(2)-3.09%
Min Revenue beat(2)-3.81%
Max Revenue beat(2)-2.38%
Revenue beat(4)0
Avg Revenue beat(4)-2.99%
Min Revenue beat(4)-3.81%
Max Revenue beat(4)-2.08%
Revenue beat(8)0
Avg Revenue beat(8)-2.31%
Revenue beat(12)0
Avg Revenue beat(12)-2.04%
Revenue beat(16)0
Avg Revenue beat(16)-1.9%
PT rev (1m)-1.77%
PT rev (3m)-16.99%
EPS NQ rev (1m)-10.61%
EPS NQ rev (3m)4.12%
EPS NY rev (1m)-1.06%
EPS NY rev (3m)28.42%
Revenue NQ rev (1m)-1.2%
Revenue NQ rev (3m)-3.28%
Revenue NY rev (1m)-1.51%
Revenue NY rev (3m)-3.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.9 | ||
| Fwd PE | 7.88 | ||
| P/S | 0.9 | ||
| P/FCF | 4.43 | ||
| P/OCF | 4.33 | ||
| P/B | 1.31 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.93 |
EPS(TTM)0.68
EY6.71%
EPS(NY)1.29
Fwd EY12.69%
FCF(TTM)2.29
FCFY22.59%
OCF(TTM)2.34
OCFY23.08%
SpS11.3
BVpS7.71
TBVpS-3.88
PEG (NY)2.38
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.19% | ||
| ROE | 9.27% | ||
| ROCE | 4.85% | ||
| ROIC | 3.78% | ||
| ROICexc | 3.91% | ||
| ROICexgc | 17.94% | ||
| OM | 6.58% | ||
| PM (TTM) | 6.32% | ||
| GM | 66.62% | ||
| FCFM | 20.25% |
ROA(3y)5.37%
ROA(5y)-11.23%
ROE(3y)12.65%
ROE(5y)-38.25%
ROIC(3y)4.71%
ROIC(5y)4.14%
ROICexc(3y)4.91%
ROICexc(5y)4.33%
ROICexgc(3y)37.49%
ROICexgc(5y)37.97%
ROCE(3y)6.04%
ROCE(5y)5.31%
ROICexcg growth 3Y-26.83%
ROICexcg growth 5Y-17.53%
ROICexc growth 3Y-0.06%
ROICexc growth 5Y15.72%
OM growth 3Y-2.2%
OM growth 5Y-2.9%
PM growth 3Y57%
PM growth 5YN/A
GM growth 3Y-1.18%
GM growth 5Y-1.8%
F-Score6
Asset Turnover0.66
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | 3.13 | ||
| Debt/EBITDA | 2.96 | ||
| Cap/Depr | 2.9% | ||
| Cap/Sales | 0.43% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 96.39% | ||
| Profit Quality | 320.35% | ||
| Current Ratio | 1.65 | ||
| Quick Ratio | 1.65 | ||
| Altman-Z | 0.29 |
F-Score6
WACC8.46%
ROIC/WACC0.45
Cap/Depr(3y)8.31%
Cap/Depr(5y)11.71%
Cap/Sales(3y)1.21%
Cap/Sales(5y)1.95%
Profit Quality(3y)352.4%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-56.69%
EPS 3Y-22.72%
EPS 5Y-14.33%
EPS Q2Q%-400%
EPS Next Y6.25%
EPS Next 2Y33.6%
EPS Next 3Y22.26%
EPS Next 5YN/A
Revenue 1Y (TTM)2.24%
Revenue growth 3Y4.86%
Revenue growth 5Y3.46%
Sales Q2Q%-0.64%
Revenue Next Year1.26%
Revenue Next 2Y2.2%
Revenue Next 3Y2.54%
Revenue Next 5Y3.05%
EBIT growth 1Y-13.18%
EBIT growth 3Y2.55%
EBIT growth 5Y0.45%
EBIT Next Year314.96%
EBIT Next 3Y66.41%
EBIT Next 5Y37.4%
FCF growth 1Y31.83%
FCF growth 3Y7.97%
FCF growth 5Y13.27%
OCF growth 1Y17.68%
OCF growth 3Y3.39%
OCF growth 5Y8.49%