Fact based stock research
Cars.com (NYSE:CARS)
US14575E1055
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Cars.com stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 32 (worse than 68% compared with investment alternatives), Cars.com (Interactive Media & Services, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Cars.com are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives), show below-average growth (Growth Rank of 41), and are riskily financed (Safety Rank of 43), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 32, is a hold recommendation based on Cars.com's financial characteristics. As the company Cars.com's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 39), low growth (Obermatt Growth Rank of 41), and risky financing practices (Obermatt Safety Rank of 43), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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Country | USA |
Industry | Interactive Media & Services |
Index | |
Size class | Medium |
19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Cars.com
RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
VALUE | ||||||||
VALUE | 18 |
|
99 |
|
85 |
|
39 |
|
GROWTH | ||||||||
GROWTH | 81 |
|
47 |
|
49 |
|
41 |
|
SAFETY | ||||||||
SAFETY | 19 |
|
27 |
|
32 |
|
43 |
|
SENTIMENT | ||||||||
SENTIMENT | n/a |
|
85 |
|
83 |
|
new | |
360° VIEW | ||||||||
360° VIEW | n/a |
|
91 |
|
82 |
|
new |
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 32 (worse than 68% compared with investment alternatives), Cars.com (Interactive Media & Services, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Cars.com are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives), show below-average growth (Growth Rank of 41), and are riskily financed (Safety Rank of 43), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 32, is a hold recommendation based on Cars.com's financial characteristics. As the company Cars.com's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 39), low growth (Obermatt Growth Rank of 41), and risky financing practices (Obermatt Safety Rank of 43), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
VALUE | ||||||||
VALUE | 18 |
|
99 |
|
85 |
|
39 |
|
GROWTH | ||||||||
GROWTH | 81 |
|
47 |
|
49 |
|
41 |
|
SAFETY | ||||||||
SAFETY | 19 |
|
27 |
|
32 |
|
43 |
|
COMBINED | ||||||||
COMBINED | 16 |
|
64 |
|
66 |
|
32 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 39 (worse than 61% compared with alternatives), Cars.com shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Cars.com. Price-to-Sales (P/S) is 60, which means that the stock price compared with what market professionals expect for future sales is lower than for 60% of comparable companies, indicating a good value concerning Cars.com's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio), which is more favorable than for 66% of alternatives (34% of peers have a higher ratio). But expected dividend yields with a Dividend Yield rank of 1 are lower than average (dividends are expected to be lower than 99% of other stocks) while the Price to Profit ratio (or Price to Earnings (P/E) ratio) is higher than average with a Price-to-Profit Rank of 38, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a hold recommendation based on Cars.com's stock price compared with the company's operational size and dividend yields. Low profits and low dividends as seen here for Cars.com may indicate a restructuring phase. This could be transitory, making the company a good value when profits recover and dividends return to higher levels. If the stock price is compared with the size indicators for revenue and invested capital, it is on the lower side, making this stock a good value investment (apart from current profit and dividend expectations). We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more
VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
PRICE VS. REVENUES (P/S) | ||||||||
PRICE VS. REVENUES (P/S) | 52 |
|
81 |
|
67 |
|
60 |
|
PRICE VS. PROFITS (P/E) | ||||||||
PRICE VS. PROFITS (P/E) | 35 |
|
100 |
|
73 |
|
38 |
|
PRICE VS. CAPITAL (Market-to-Book) | ||||||||
PRICE VS. CAPITAL (Market-to-Book) | 28 |
|
81 |
|
70 |
|
66 |
|
DIVIDEND YIELD | ||||||||
DIVIDEND YIELD | 1 |
|
1 |
|
1 |
|
1 |
|
CONSOLIDATED RANK: VALUE | ||||||||
CONSOLIDATED RANK: VALUE | 18 |
|
99 |
|
85 |
|
39 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 41 (better than 41% compared with alternatives), Cars.com shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Cars.com. Only Capital Growth has a good rank of 95, which means that currently professionals expect the company to grow its invested capital more than 6% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 26 which means that currently professionals expect the company to grow less than 74% of its competitors. Profit Growth with a rank of 6 and Stock Returns with a rank of 49 are also low (below 51% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 41, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Cars.com is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more
GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
REVENUE GROWTH | ||||||||
REVENUE GROWTH | 39 |
|
8 |
|
32 |
|
26 |
|
PROFIT GROWTH | ||||||||
PROFIT GROWTH | n/a |
|
76 |
|
96 |
|
6 |
|
CAPITAL GROWTH | ||||||||
CAPITAL GROWTH | n/a |
|
23 |
|
15 |
|
95 |
|
STOCK RETURNS | ||||||||
STOCK RETURNS | 80 |
|
91 |
|
67 |
|
49 |
|
CONSOLIDATED RANK: GROWTH | ||||||||
CONSOLIDATED RANK: GROWTH | 81 |
|
47 |
|
49 |
|
41 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 43 (better than 43% compared with alternatives), the company Cars.com has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Cars.com is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Cars.com. Refinancing is at 52, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 52% of its competitors. Liquidity is also good at 59, meaning the company generates more profit to service its debt than 59% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 30, which means the company has an above-average debt-to-equity ratio. It has more debt than 70% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 43 (worse than 57% compared with alternatives), Cars.com has a financing structure that is riskier than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Cars.com could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with Cars.com and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
LEVERAGE | ||||||||
LEVERAGE | 24 |
|
10 |
|
26 |
|
30 |
|
REFINANCING | ||||||||
REFINANCING | 69 |
|
51 |
|
29 |
|
52 |
|
LIQUIDITY | ||||||||
LIQUIDITY | 31 |
|
64 |
|
70 |
|
59 |
|
CONSOLIDATED RANK: SAFETY | ||||||||
CONSOLIDATED RANK: SAFETY | 19 |
|
27 |
|
32 |
|
43 |
|
Sentiment Metrics in Detail
SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
ANALYST OPINIONS | ||||||||
ANALYST OPINIONS | n/a |
|
69 |
|
59 |
|
new | |
OPINIONS CHANGE | ||||||||
OPINIONS CHANGE | n/a |
|
50 |
|
50 |
|
new | |
PRO HOLDINGS | ||||||||
PRO HOLDINGS | n/a |
|
63 |
|
92 |
|
new | |
MARKET PULSE | ||||||||
MARKET PULSE | n/a |
|
56 |
|
69 |
|
new | |
CONSOLIDATED RANK: SENTIMENT | ||||||||
CONSOLIDATED RANK: SENTIMENT | n/a |
|
85 |
|
83 |
|
new |
Free stock analysis by the purely fact based Obermatt Method for Cars.com from December 19, 2024.
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