Barrington analyst Gary Prestopino maintained a Buy rating on Cars (CARS – Research Report) today and set a price target of $25.00.
Gary Prestopino has given his Buy rating due to a combination of factors including Cars.com’s solid financial performance and strategic acquisitions. The company reported a strong Q4/24 with adjusted EBITDA surpassing expectations, despite slightly lower revenue. This performance capped off a successful year with an 8% increase in adjusted EBITDA and robust free cash flow generation.
Moreover, the acquisition of DealerClub is a significant strategic move, enhancing Cars.com’s platform capabilities by entering the $10 billion wholesale market. This acquisition, along with the growth in AccuTrade and new OEM endorsements, positions Cars.com to efficiently scale and attract new customers. The integration of DealerClub and AccuTrade’s advanced valuation tools provides a comprehensive platform for managing the vehicle lifecycle, which is expected to bolster Cars.com’s sales funnel and market presence.
In another report released on February 28, BTIG also maintained a Buy rating on the stock with a $21.00 price target.
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