Oppenheimer Cuts CarGurus Target Price 5% to $38, Keeps Outperform
CarGurus’ target price was cut by 5% to $38 while the Outperform rating was retained, following an ~18% year-to-date stock decline driven by AI-related multiple compression. Oppenheimer cited CarGurus’ proprietary valuation data, strong dealer ties, AI adoption and new products as key drivers for potential upside.
1. Target Price Cut and Rating
Oppenheimer trimmed CarGurus’ target price to $38 from $40, a 5% reduction, while maintaining an Outperform rating, reflecting confidence in the company’s long-term positioning despite near-term valuation pressure.
2. AI Disruption Impact
Analysts highlighted AI-related valuation multiple compression as a primary factor in CarGurus’ ~18% year-to-date stock decline but noted that proprietary used-car valuation data and strong dealer relationships help insulate the business.
3. New Products Driving Upside
CarGurus’ new offerings—PriceVantage, New Car Exposure, CG Discover and Dealership Mode—are expected to leverage the company’s scale for high incremental margins and support future revenue growth.
4. 2026 Revenue Guidance
Management’s 2026 guidance projects durable U.S. quarterly average revenue per subscribing dealer driven by subscription upgrades and higher attach rates for new products.