Analysts Mixed on CarGurus (CARG) Amid Lower Margin Expectations for 2026

CarGurus Inc. (NASDAQ:CARG) is one of the most undervalued stocks to buy and hold for 5 years, despite tempering 2026 margin forecasts. During the Needham Growth Conference on January 13, executives from CarGurus Inc (NASDAQ:CARG) stated that the company has discussed ramping up its investments, likely resulting in “a slight step down in margin” because of those investments. The executives said, “We’re doing that to maintain a higher growth rate than we otherwise would have,” adding that the company is aiming for long-term sustainable growth through deepening its relationship with dealers.

Following the conference, on January 16, J.P. Morgan analyst Rajat Gupta retained his Hold rating on CarGurus Inc. (NASDAQ:CARG) and set a price target of $43.00. Meanwhile, on December 30, 2025, BTIG raised its price target on CarGurus Inc (NASDAQ:CARG) to $44 from $39, while maintaining a Buy rating, estimating that the company’s emerging solutions business is currently worth $100 million, or roughly $1 per share.

CarGurus Inc. (NASDAQ:CARG) is an online automotive platform for buying and selling vehicles. The company’s car listings marketplace features digital retail solutions and the CarOffer digital wholesale platform. CarGurus operates through segments, including the customer-facing U.S. Marketplace and the Digital Wholesale division, which provides dealer-to-dealer services and products sold on the CarOffer platform.

While we acknowledge the potential of CARG as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 10 Most Undervalued Stocks to Buy and Hold for 5 Years and 14 Best Tech Stocks Under $10 to Buy

Disclosure: None. This article is originally published at Insider Monkey.