Cars.com downgraded to Neutral from Overweight at JPMorgan

JPMorgan downgraded Cars.com to Neutral from Overweight (CARS) with a price target of $19, down from $25. The company’s Q2 results and second half of 2024 guidance came in softer than estimates, with commentary around monthly average revenue per dealer and ancillary product adoption suggesting low visibility on a growth reacceleration, the analyst tells investors in a research note. The firm says this is happening at a time when Cars.com peer CarGurus (CARG) continues to gain share and is seeing solid uptake of its expanded product portfolio. JPMorgan’s relative preference leans towards Cars.com’s auto retail ecosystem peers with a more visible forward revisions trajectory coupled with product differentiation and execution.