MeritValue

CarGurus, Inc.

CARGdata completeness 100%11 fiscal years on file

Data notes: no data for concept 'investmentsAtFairValue'; no data for concept 'netInvestmentIncome'; no data for concept 'gainsOnRealEstateSales'; no data for concept 'dividendsPaid'

The thesis, from the filings

CarGurus, Inc. earns about 52% on invested capital, far above its ~9% cost of capital, and has bought back 14% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $8.71 and $37.66 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$951.4M1$1.66B2$698.4M3$798M3$907M3
Net income$109.2M4$84.4M5$36.9M6$21M6$155.9M6
Operating cash flow$98.3M7$256.1M8$124.5M9$255.5M9$295.3M9
Capital expenditure$7.71M10$5.92M11$24.6M12$75.2M12$6.38M12
Free cash flow (derived)$90.6M7$250.2M8$100M9$180.3M9$288.9M9
Total debt$013$014$015$016$016
Cash & equivalents$231.9M17$469.5M18$291.4M19$304.2M20$190.5M20
Diluted shares117.1M128.2M114.2M106.3M100.4M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$37.27
your share of equity
Profit it earned you last year
$15.53
Free cash flow it threw off
$28.77
Debt you’d be carrying
$0

10 shares is a claim on $37.27 of net worth that earned you $15.53 and generated $28.77 of cash last year, against $0 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
52% avg · 5y
FY21 39%FY22 30%FY23 28%FY24 54%FY25 107%

It earned about 52% on invested capital, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
−14% shares · 5y

Share count is down 14% over 5 years — management has been buying back stock, quietly handing owners a bigger slice.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.5.0

The 3 estimate methods that apply put fair value between $8.71 and $37.66 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$37.66
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth5.4%
  • fcfBase$180.3M
DCF · Growth Exit 5Y
$34.38
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth5.4%
  • fcfBase$180.3M
Earnings Power Value
$8.71
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$84.4M
  • growthAssumed0.0%
Graham Number
$11.4
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years5.4%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $34.38
The three cases
Bear0.0%$27.56
Base5.4%$34.38
Bull10.4%$41.93

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 5.4%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000950170-24-020157 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000950170-25-024181 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001193125-26-059435 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000950170-24-020157 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000950170-25-024181 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001193125-26-059435 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000950170-24-020157 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000950170-25-024181 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001193125-26-059435 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000950170-24-020157 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000950170-25-024181 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001193125-26-059435 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000950170-23-005473 (LongTermDebt)
  14. 10-K · period ending 2022-12-31 · accession 0000950170-24-020157 (LongTermDebt)
  15. 10-K · period ending 2023-12-31 · accession 0000950170-25-024181 (LongTermDebt)
  16. 10-K · period ending 2024-12-31 · accession 0001193125-26-059435 (LongTermDebt)
  17. 10-K · period ending 2021-12-31 · accession 0000950170-23-005473 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0000950170-24-020157 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0000950170-25-024181 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0001193125-26-059435 (CashAndCashEquivalentsAtCarryingValue)