CARG - CarGurus: The Rebound Rally Has Steam

2024-06-25 14:54:02 ET

Summary

• CarGurus is poised for a rebound as the company has turned around its marketplace business.
• It is now back to growing paid dealership counts, after several quarters of decline.
• User traffic is also rebounding, especially as CarGurus improves its available car inventory shown on the site.
• The stock trades at a very reasonable ~2.5x multiple of next year's revenue.

Sometimes, turnaround stories require a bit of patience: but they make for great holds while the rest of the stock market is exceedingly expensive. And with record-breaking S&P 500 multiples, I'm positioning more and more of my portfolio into these value-oriented rebound plays....

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