Cars.com (NYSE:CARS) Releases Earnings Results, Misses Expectations By $0.03 EPS

Cars.com (NYSE:CARS) released its quarterly earnings results on Thursday. The company reported $0.45 EPS for the quarter, missing the consensus estimate of $0.48 by ($0.03), Briefing.com reports. Cars.com had a net margin of 3.73% and a return on equity of 18.12%. The business had revenue of $180.22 million during the quarter, compared to analyst estimates of $180.16 million. During the same quarter last year, the company posted $0.37 earnings per share. The company’s revenue was up .7% on a year-over-year basis.

Here are the key takeaways from Cars.com’s conference call:

• Cars.com beat expectations in Q1 with $180.2M revenue (up 1% YoY), adjusted EBITDA margin 28.3% (>1 ppt above guidance), free cash flow up 42% YoY, and raised its 2026 share repurchase target to $90M while repurchasing 3.8M shares YTD.
• Management announced and began implementing a cost reduction program targeting $25M–$30M of recurring annualized operating savings to help grow adjusted EBITDA faster than revenue, with partial savings reflected in Q2 guidance.
• Product and AI initiatives are accelerating — MCP integration with ChatGPT, the Conversational Carson assistant (consumers are >4x more likely to submit a lead after interacting), and a new Dealer app — all intended to build an interconnected, AI-first marketplace and improve dealer ROI.
• OEM and national advertising revenue remains pressured (down about $2M YoY in Q1) as some manufacturers reallocated budgets, and management expects Q2 to be a trough with cautious timing for recovery, adding near-term revenue risk.
• Customer metrics are mixed — Marketplace added dealers (+140 YoY) but overall dealer/solutions and website units declined sequentially and AccuTrade subscribers fell as the company de-emphasizes standalone offerings in favor of bundled packages, creating short-term churn and execution risk.

Cars.com Price Performance

CARS stock traded down $0.65 during mid-day trading on Friday, hitting $11.68. The stock had a trading volume of 1,098,516 shares, compared to its average volume of 907,628. The firm has a fifty day simple moving average of $9.23 and a 200 day simple moving average of $10.83. The firm has a market capitalization of $679.19 million, a P/E ratio of 27.17 and a beta of 1.64. The company has a current ratio of 1.87, a quick ratio of 1.87 and a debt-to-equity ratio of 0.98. Cars.com has a 52 week low of $7.40 and a 52 week high of $13.97.

Institutional Trading of Cars.com

Several large investors have recently made changes to their positions in CARS. Par Capital Management Inc. acquired a new position in Cars.com during the second quarter valued at approximately $14,220,000. JPMorgan Chase & Co. lifted its stake in Cars.com by 112.1% during the fourth quarter. JPMorgan Chase & Co. now owns 1,127,095 shares of the company’s stock worth $13,751,000 after purchasing an additional 595,609 shares during the last quarter. Bridgeway Capital Management LLC acquired a new stake in shares of Cars.com in the 2nd quarter valued at $3,776,000. Arrowstreet Capital Limited Partnership increased its stake in shares of Cars.com by 23.1% in the 3rd quarter. Arrowstreet Capital Limited Partnership now owns 1,057,322 shares of the company’s stock valued at $12,920,000 after purchasing an additional 198,077 shares during the last quarter. Finally, Monimus Capital Management LP acquired a new position in shares of Cars.com during the 4th quarter worth $2,086,000. Institutional investors and hedge funds own 89.15% of the company’s stock.

Wall Street Analyst Weigh In

A number of analysts have issued reports on CARS shares. Zacks Research raised shares of Cars.com from a “strong sell” rating to a “hold” rating in a report on Wednesday, April 15th. BTIG Research lifted their price target on shares of Cars.com from $13.00 to $14.00 and gave the company a “buy” rating in a research report on Thursday. B. Riley Financial cut Cars.com from a “buy” rating to a “neutral” rating and set a $13.00 price target for the company. in a research note on Friday. UBS Group increased their price target on Cars.com from $11.00 to $12.00 and gave the stock a “neutral” rating in a research report on Friday. Finally, JPMorgan Chase & Co. lifted their price objective on Cars.com from $10.00 to $11.00 and gave the company a “neutral” rating in a report on Friday. Three investment analysts have rated the stock with a Buy rating, four have issued a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat.com, the company currently has a consensus rating of “Hold” and an average price target of $14.67.

Key Headlines Impacting Cars.com

Here are the key news stories impacting Cars.com this week:

• Positive Sentiment: Cars.com reaffirmed its 2026 outlook for flat to 2% revenue growth and a 29% to 30% adjusted EBITDA margin, while also boosting its share repurchase target to $90 million, signaling confidence in cash generation and capital return. Article link
• Positive Sentiment: Q1 results showed revenue of $180.2 million, adjusted EBITDA of $51.0 million, and an adjusted EBITDA margin of 28.3%, which exceeded guidance and suggests operating performance remains healthy despite modest top-line growth. Article link
• Positive Sentiment: BTIG Research raised its price target on Cars.com to $14 from $13 and kept a Buy rating, indicating some analysts see further upside from current levels. Article link
• Positive Sentiment: JPMorgan also lifted its price target to $11 from $10, even while maintaining a Neutral rating, reflecting improved valuation expectations after the earnings release. Article link
• Neutral Sentiment: Cars.com reported adjusted results that were largely in line with revenue expectations, but the market is balancing that against the earnings miss and modest growth profile. Article link
• Negative Sentiment: The company posted Q1 EPS of $0.45, missing Wall Street estimates of $0.48, which is the main reason shares have moved lower. Article link

About Cars.com

Cars.com operates as a leading online automotive marketplace in the United States, connecting car shoppers with new and used vehicle listings from dealerships and private sellers. The platform enables consumers to research makes and models, compare prices, read expert and user reviews, and access tools such as TrueCost to estimate ownership expenses over time. Through its website and mobile applications, Cars.com aims to simplify the car-buying process by aggregating detailed vehicle data, payment calculators, and dealership ratings into a single user-friendly experience.

On the dealer side, Cars.com provides a suite of marketing and lead-generation services designed to help automotive retailers reach potential buyers and manage their online presence.