Back to top
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
TrueCar, Inc. (TRUE) - free report >>
Carvana Co. (CVNA) - free report >>
We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
TrueCar, Inc. (TRUE) - free report >>
Carvana Co. (CVNA) - free report >>
Image: Bigstock
Bear Of The Day: Cars.com
Cars.com (CARS - Free Report) is a Zacks Rank #5 (Strong Sell) and that makes it elegible for the Bear of the Day article. I felt it was good one to run against the Tesla (TSLA) Bull of the Day article which you can read here: https://www.zacks.com/commentary/166108/bull-of-the-day:-tesla-(tsla)-)
So why is Cars.com a Zacks Rank #5 (Strong Sell)? The quick and easy answer is that earnings estimates have been falling. The Zacks Consensus Estimate has dropped from $2.61 to $2.14 over the last 30 days. The Zacks Consensus Estimate for 2019 has also slipped. It moved from $2.94 to $2.45 over the same time period.
Earnings Miss
I see that Cars.com missed the mark in a big way in the most recent earnings release. The company reported $0.39 but the Zacks Consensus Estimate was looking for $0.64. That is a miss of $0.25 or just a little over 39% under expectations.
Following the miss, analysts took estimates down for this year and next year as well.
Recent M&A Rumor
On May 31 there was an article in the NY Post that said the company hired JPMorgan to help sell the company. This may or may not be true, but the simple fact is once a rumor like this hits the press it isn't going away until the company comes out and says that it is not for sale.
There are several other names in the auto space that are just as interesting as Cars.com.
CVNA Zacks Rank #3 (Hold)
CARG Zacks Rank #3 (Hold)
TRUE Zacks Rank #3 (Hold)
CVNA has a different business model than the advertising model that is emploiyed by several of the stocks in this space.
Chart
Cars.com Inc. Price and Consensus
Cars.com Inc. Price and Consensus | Cars.com Inc. Quote
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>