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Undervalued
Morningstar Quantitative Rating as of 4 NOV 2026.
Quantitative Equity Rating Methodology – view here
Five-star price 26.67 Fair value 30.10 One-star price 33.98
Morningstar Quantitative Rating as of 4 NOV 2026.
Morningstar Quantitative Rating as of 4 NOV 2026. The slider runs from the five-star price (26.67) to the one-star price (33.98).
| Ratios |
|---|
| Currency (Price/reporting): AUD/AUD |
| Exchange Rate: 1.0000 |
| Price - closing or last bid | 26.67 |
| Price - 12 month high | 35.33 |
| Price - 12 month low | 21.20 |
| Pricing date | 4 NOV 2026 |
| Volume - avg. trading volume for the last ten days | 1.62 |
| Market capitalization | 10,118.13 |
| 12 Month High price date | 6 NOV 2025 |
| 12 Month Low price date | 29 SEP 2026 |
| Volume - avg. trading volume for the last 3 months | 2.31 |
| Price - 1 Day % Change | 7.54% |
| Price - 13 week price percent change | -0.86% |
| Price - 26 week price percent change | 4.38% |
| Price - 5 Day % Change | 11.08% |
| Price - 52 week price percent change | -23.21% |
| Price - YTD price percent change | -13.30% |
| Price % Change Month To Date | 19.22% |
| EPS excluding extraordinary items - most recent fiscal year | 0.828 |
| EPS excluding extraordinary items - trailing 12 month | 0.828 |
| EPS Normalized - most recent fiscal year | 1.075 |
| Revenue/share - most recent fiscal year | 3.308 |
| Revenue/share - trailing 12 month | 3.308 |
| Book value per share - most recent fiscal year | 7.240 |
| Book value per share - most recent half-year | 7.240 |
| Book value (tangible) per share - most recent fiscal year | -3.590 |
| Book value (tangible) per share - most recent half-year | -3.590 |
| Cash per share - most recent fiscal year | 0.859 |
| Cash per share - most recent half-year | 0.859 |
| Cash Flow per share - most recent fiscal year | 1.275 |
| Cash Flow per share - trailing 12 month | 1.275 |
| Dividend per share - most recent fiscal year | — |
| Dividends per share - trailing 12 month | 0.860 |
| EBITD per share - trailing 12 month | 1.761 |
| EPS Basic excluding extraordinary items - most recent fiscal year | 0.829 |
| EPS Basic excluding extraordinary items - trailing 12 month | 0.829 |
| EPS including extraordinary items - most recent fiscal year | 0.829 |
| EPS including extraordinary items - trailing 12 month | 0.829 |
| Free Cash Flow per share - trailing 12 month | 0.902 |
| P/E excluding extraordinary items, most recent fiscal year | 32.21 |
| P/E Normalized, most recent fiscal year | 24.81 |
| Price to sales - most recent fiscal year | 8.06 |
| Price to Tangible Book - most fiscal year | — |
| Price to Free Cash Flow per Share - most recent fiscal year | 29.57 |
| Price to Cash Flow per share - trailing 12 month | 20.91 |
| Price to Book - most recent fiscal year | 3.68 |
| P/E excluding extraordinary items high, trailing 12 months | 47.76 |
| P/E excluding extraordinary items low, trailing 12 months | 25.83 |
| Net Debt, LFI | 1,326.20 |
| Net Debt, LFY | 1,276.17 |
| Dividend Yield - 5 Year Average | 2.23% |
| Dividend Yield - indicated annual dividend divided by closing price | 3.40% |
| Current Dividend Yield - Common Stock Primary Issue, LTM | 3.22% |
| Free Cash Flow - most recent fiscal year | 341.76 |
| LT debt/equity - most recent fiscal year | 55.53% |
| Payout ratio - most recent fiscal year | — |
| Total debt/total equity - most recent fiscal year | 56.90% |
| LT debt/equity - most recent half-year | 52.22% |
| Total debt/total equity - most recent half-year | 53.88% |
| Free Cash Flow - trailing 12 month | 341.76 |
| Payout ratio - trailing 12 month | — |
| Revenue - most recent fiscal year | 1,253.43 |
| Revenue - trailing 12 month | 1,253.43 |
| EBITD - most recent fiscal year | 667.27 |
| EBITD - trailing 12 month | 667.27 |
| Earnings before taxes - most recent fiscal year | 423.69 |
| Earnings before taxes - trailing 12 month | 423.69 |
| Net Income available to common - most recent fiscal year | 313.69 |
| Net Income available to common - trailing 12 months | 313.69 |
| Earnings before taxes Normalized - most recent fiscal year | 423.69 |
| Net Income Available to Common, Normalized - most recent fiscal year | 407.18 |
| Earnings per Share, Normalized, Excluding Extraordinary Items, Avg. Diluted Shares Outstanding, TTM | 1.08 |
| Net Profit Margin % - 1st historical fiscal year | 26.52% |
| Net Profit Margin % - trailing 12 month | 26.52% |
| Operating margin - 1st historical fiscal year | 38.45% |
| Operating margin - trailing 12 month | 38.45% |
| Pretax margin - trailing 12 month | 33.80% |
| Pretax margin - 1st historical fiscal year | 33.80% |
| Operating Margin - 5 year average | 39.07% |
| Pretax Margin - 5 year average | 46.05% |
| Free Operating Cash Flow/Revenue, 5 Year Average | 25.99% |
| Free Operating Cash Flow/Revenue, TTM | 27.27% |
| Net Profit Margin - 5 year average | 37.95% |
| Return on average assets - most recent fiscal year | 6.84% |
| Return on average assets - trailing 12 month | 6.84% |
| Return on average equity - most recent fiscal year | 11.68% |
| Return on average equity - trailing 12 month | 11.68% |
| Return on average assets - 5 year average | 9.86% |
| Return on average equity - 5 year average | 16.43% |
| Net Income/employee - most recent fiscal year | — |
| Revenue/employee - most recent fiscal year | — |
| Revenue growth rate, 5 year | 24.02% |
| EPS growth rate, 5 year | 10.23% |
| Growth rate% - dividend, 3 year | 16.73% |
| Revenue/share (5 yr growth) | 14.75% |
| Growth rate% - Revenue, 3 year | 17.07% |
| Growth rate% - EPS, 3 year | -22.96% |
| Book value per share growth rate, 5 year | 17.55% |
| Capital Spending growth rate, 5 year | 33.53% |
| Earnings Before Interest, Taxes, Depreciation & Amortization, 5 Year CAGR | 22.14% |
Financial forecast (AUD, millions except per share)
| Actuals | Estimates | |||||||
| 2026 | 2027 | 2028 | 2029 | |||||
| Estimate breakdown | ||||||||
Financials (AUD, millions)
| Period end: | JUN 22 | JUN 23 | JUN 24 | JUN 25 | JUN 26 |
| Fiscal year: | 2022 | 2023 | 2024 | 2025 | 2026 |
| Period length: | 12 months | 12 months | 12 months | 12 months | 12 months |
Announcements
| DATE | TIME | HEADING | PAGES |
| Price sensitive |
We are buying back into Car Group (CAR) in the Growth Portfolio inline with recent comments on the stock here. We expect annual earnings growth of ~13% , with CAR now trading at an attractive valuation for that level of growth. Software/platform stocks have recovered in the US, and we expect the same trend locally, aided by the expectation that cash rates have peaked.
CAR Group (CAR) rose +3.5% on Wednesday having followed MM’s roadmap through most of 2026, covered here, along with its solid August result, with FY26 adjusted profit increasing 8% to $407m, while FY27 guidance is for 11–14% revenue growth.
CAR Group (CAR) has followed the path we forecast in late September here, after testing the $21 level. The stock bounced +2% yesterday but it remains down a painful 27% YTD, with another test of $20-21 feeling likely if the ASX does endure another leg on the downside. Importantly, the weakness has been driven more by multiple compression than collapsing earnings, operationally, FY26 adjusted profit rose 8% to $407m and FY27 revenue growth of 11–14% is expected, but rising bond yields, earnings downgrades and concerns around AI potentially disrupting online marketplaces have weighed heavily on its previously premium valuation.
CAR delivered a strong FY26 result covered here, which as we saw with several results, saw sharp gains before a resumption of the downtrend. CAR has fallen around 35% over the past 12 months, significantly underperforming both the ASX 200 and Consumer Discretionary sector.
CAR +9.92%: delivered a broadly in-line FY26 result, but it was the stronger-than-expected FY27 outlook that caught our attention, sending shares sharply higher. After a difficult year for the classifieds sector amid concerns around slowing growth and potential AI disruption, the guidance went a long way toward addressing both issues.
CAR managed to bounce ~13% off its late February low but its feeling increasingly like a begrudging move and our preferred scenario is it tests $23 in the coming weeks/months. We ultimately believe CAR and other classified type business are more susceptible to disruption relative to a WiseTech or Technology One, for instance, with higher risk around competitive pressures.
CAR group isn’t a complicated business per se, it makes money by operating leading online automotive marketplaces where dealers and private sellers pay to list vehicles and related services. The stock rallied ~10% earlier in the month after delivering a solid result and exciting investors by saying its AI spend is being absorbed within existing development budgets, leveraging CAR’s proprietary data - read Here.
CAR +9.93% delivered a clean/inline 1H26 result, reaffirming guidance and easing concerns after the recent tech sell-off. Earnings growth was solid, margins held up, and the dividend stepped higher. A meet was enough given the weakness leading into the result.
We are making 3 changes to the Growth Portfolio
AI poses a genuine medium-term challenge to CAR Group by threatening the economics of online marketplaces rather than the existence of the platform itself. As AI reshapes how consumers search, compare and transact, carsales risks losing some control over traffic flows, facing greater price transparency and seeing the value of leads compress. Over time, that could weaken dealer pricing power and increase customer acquisition costs.
MM is buying CAR in the Active Growth Portfolio, allocating 4% around $25
MM is bullish towards CAR below $25
MM is bullish towards CAR around $22
MM is bullish towards CAR around $21
MM is cautiously bullish CAR ~$29
MM would get bullish CAR around $23
MM is neutral towards CAR Group ~$24
MM is neutral CAR ~$27.00
We are neutral towards CAR around $26
MM is selling CAR in the Active Growth Portfolio, taking a loss around $25.50
Car Group is a globally diversified group of online marketplaces for auto and nonauto vehicles. The group's primary business is its Australian online marketplace for automotive, www.carsales.com.au., which is the dominant online automotivemarketplace in Australia, at around nine times total time spent compared with its nearest competitor. Car Group also owns and operates businesses in various geographic, category and product adjacencies, including online marketplaces for automotive in South Korea and Latin America, nonautomotive online marketplaces in Australia and the United States, and data businesses.
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