Blucora (BCOR) vs. Cars.com (CARS) Critical Analysis

Blucora (NASDAQ: BCOR) and Cars.com (NYSE:CARS) are both small-cap business services companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, institutional ownership, valuation, risk and profitability.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Blucora and Cars.com, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Blucora 0 1 3 0 2.75
Cars.com 0 1 2 0 2.67

Blucora currently has a consensus price target of $27.67, indicating a potential upside of 35.95%. Cars.com has a consensus price target of $34.00, indicating a potential upside of 42.80%. Given Cars.com’s higher probable upside, analysts clearly believe Cars.com is more favorable than Blucora.

Institutional and Insider Ownership

89.4% of Blucora shares are held by institutional investors. 14.1% of Blucora shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Blucora and Cars.com’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Blucora -0.46% 11.94% 5.80%
Cars.com N/A N/A N/A

Valuation & Earnings

This table compares Blucora and Cars.com’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Blucora $455.91 million 2.06 -$65.15 million ($0.09) -226.09
Cars.com N/A N/A N/A N/A N/A

Cars.com has lower revenue, but higher earnings than Blucora.

Summary

Blucora beats Cars.com on 7 of the 9 factors compared between the two stocks.

Blucora Company Profile

Blucora, Inc. is a provider of technology-enabled financial solutions to consumers, small business owners and tax professionals. The Company operates through the Wealth Management and Tax Preparation segments. The Company’s Wealth Management segment consists of HD Vest, which provides financial advisors with an integrated platform of brokerage, investment advisory and insurance services to assist in making each financial advisor a financial service center for his/her clients The Company’s Tax Preparation segment provides digital do-it-yourself (DDIY) tax preparation solutions for consumers, small business owners and tax professionals. TaxAct, a provider of digital tax preparation solutions. HD Vest’s specialized model provides an open-architecture investment platform and technology tools to help financial advisors identify investment opportunities for their clients. TaxAct offers pricing and packaging options for tax professionals.

Cars.com Company Profile

Cars.com Inc. owns a digital automotive marketplace business (Cars.com). Cars.com is an online research destination for car shoppers. The Company is engaged in the sale of online subscription advertising products targeting car dealerships. It offers a suite of products and services targeting the automotive needs of its buyer and seller customers. Cars.com offers a digital automotive marketplace search engine that helps car buyers to make informed purchasing decisions and helps sellers to engage with a portion of their target customer base. This online automotive marketplace service connects buyers and sellers across five Websites: Cars.com, Auto.com, DealerRater.com, NewCars.com and PickupTrucks.com. Its automotive marketplace products also include credible user and automotive and dealer reviews. It is also engaged in the sale of display advertising to national advertisers. Car buyers and car owners interface with Cars.com primarily through the Cars.com sites and mobile applications.

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