Why CarGurus Shares Dropped 19.4% Today
Key Insights:
* CarGurus (CARG) Q4 revenue and guidance missed expectations, leading to a 19.4% stock decline.
* Sales growth was sluggish, with Wholesale and Product revenue declining by 55%.
* Despite revenue challenges, gross profit and adjusted EBITDA increased.
* Q1 revenue projections indicate ongoing softness in Wholesale and Product segments.
* Marketplace momentum and improved profitability provide a glimmer of optimism.
Market Reaction:
* CarGurus shares have exhibited low volatility, with only three significant price moves over 5% in the past year.
* This price drop is a clear indication of the news' impact on investor sentiment.
* The previous significant move was a 19.6% gain on the back of strong Q2 earnings performance, particularly in the Marketplace business.
Stock Performance:
* Year-to-date, CarGurus is down 15.7% to $30.14 per share.
* The stock is currently trading 25.7% below its 52-week high of $40.55.
* Over the past five years, a $1,000 investment in CarGurus would have grown to $1,092.