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Cars.com Will Continue Its Growth Streak In 2023, Says Analyst

  • Barrington Research analyst Gary Prestopino reiterated an Outperform rating on the shares of Cars.com Inc (NYSE: CARS) with a target price of $25.00.

  • The analyst believes that the company is poised for consistent growth for the remainder of 2022 and all of 2023, having completed its transformation from a listing service to a technology-driven automotive marketplace solutions provider through its digital solutions product suite.

  • Cars.com's growth strategy is being driven by connecting buyers and sellers of vehicles through a range of digital solutions across a common technology platform that simplifies vehicle purchase activity, added Prestopino.

  • Also Read:  Hertz Global To Buy 175,000 EVs From General Motors

  • Driven by new dealers, increased dealer retention, and digital solutions, dealer-generated subscription-based revenues have increased for eight consecutive quarters from $124 million in Q3 FY20 to $143 million in Q2 FY22.

  • The company's end-to-end digital solutions are driving growth in revenue despite a challenging environment for new and used vehicle sales stemming from supply constraints.

  • Prestopino also noted that Cars.com has a significant dealer and advertising TAM for growth.

  • The analyst specified that the company's financial results and long-term outlook continue to improve, but it is not reflected in the stock's valuation.

  • Price Action: CARS shares are trading higher by 1.03% at $11.77 on the last check Wednesday.

Latest Ratings for CARS

Date

Firm

Action

From

To

Feb 2022

Northcoast Research

Initiates Coverage On

Neutral

Nov 2021

DA Davidson

Maintains

Buy

Aug 2021

Truist Securities

Initiates Coverage On

Buy

View More Analyst Ratings for CARS

View the Latest Analyst Ratings

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