CarGurus (CARG) has wrapped up FY 2025 with fourth quarter revenue of US$241.1 million and basic EPS of US$0.56, alongside trailing twelve month revenue of US$907.0 million and EPS of US$1.99 that sit against a 52.8% earnings growth figure for the year. Over the past few quarters, revenue has ranged from US$225.2 million to US$241.1 million while quarterly EPS moved between US$0.23 and US$0.56, contributing to trailing twelve month net income of US$196.7 million and leaving the stock at US$38.16 as the market weighs that 21.7% net margin against growth expectations. Overall, the latest numbers point to a business where profitability levels and margin resilience are central to how investors are likely to read this result.

See our full analysis for CarGurus.

With the headline figures on the table, the next step is to see how these results line up with the main stories around CarGurus, and where the numbers start to push back on those narratives.

21.7% net margin supports high quality earnings story

• On a trailing twelve month basis, CarGurus generated US$906.98 million in revenue and US$196.74 million in net income from continuing operations, which works out to a 21.7% net margin compared with 16.1% a year ago.
• Analysts' bullish narrative leans heavily on this margin strength, arguing that winding down lower margin wholesale activity and focusing on higher margin marketplace and data products can support profitability. However, the improved 21.7% margin is coming alongside forecast revenue growth of about 8% per year, so the bullish case depends more on efficiency and mix than on fast top line expansion.

52.8% earnings growth meets mixed growth expectations

• Earnings over the last year grew 52.8% to US$196.7 million, and the trailing twelve month EPS of US$1.99 compares with a five year compound earnings growth rate of 12% per year and analyst expectations for about 16.9% annual earnings growth ahead.
• Consensus narrative highlights AI driven analytics and digital retail tools as growth drivers. This strong 52.8% earnings growth together with TTM revenue of roughly US$907.0 million shows the model can generate higher profit from a moderate revenue base, although forecast revenue growth of around 8% per year, below the US market's 11.4%, means the consensus hinges on margin and product mix rather than CarGurus suddenly matching broader market revenue growth.

P/E and DCF send different valuation signals

• At a share price of US$38.16, CarGurus trades on an 18.5x P/E, which is lower than the US Interactive Media & Services industry average of 20.1x but higher than the cited peer average of 11.2x. The share price also sits about 41.5% below the DCF fair value estimate of US$65.26.
• Bears focus on competition and limited international reach, and the 18.5x P/E premium to peers and forecast 8% revenue growth that trails the US market's 11.4% support those concerns. At the same time, the 52.8% earnings growth, 21.7% margin and gap to the US$65.26 DCF fair value mean the bear view has to explain why these profitability metrics and valuation model output are not enough to justify the current US$38.16 price.

On days like this, getting both the optimistic and cautious angles in one place helps you judge whether the recent 52.8% earnings growth and 21.7% margin really change the story for CarGurus, or if competitive and growth risks still dominate your thesis. See what the community is saying about CarGurus.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for CarGurus on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

With sentiment on CarGurus clearly mixed, this is a good moment to move fast, test the story against the numbers, and decide where you stand. To see what investors are optimistic about right now, start by reviewing its 3 key rewards.

See What Else Is Out There

CarGurus pairs strong margins and earnings with forecast revenue growth of about 8% per year, which trails the broader US market's 11.4% expectation.

If that slower top line outlook makes you want stronger growth potential, use the screener containing 23 high quality undiscovered gems to quickly spot other stocks where the story might be just getting started.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.