Head-To-Head Comparison: GoodRx (NASDAQ:GDRX) versus CarGurus (NASDAQ:CARG)

GoodRx (NASDAQ:GDRX) and CarGurus (NASDAQ:CARG) are both mid-cap medical companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, dividends, valuation, analyst recommendations, risk and earnings.

Analyst Ratings

This is a breakdown of current recommendations and price targets for GoodRx and CarGurus, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GoodRx	1	4	9	1	2.67
CarGurus	0	3	7	0	2.70

GoodRx presently has a consensus target price of $9.36, indicating a potential upside of 34.44%. CarGurus has a consensus target price of $29.35, indicating a potential downside of 6.68%. Given GoodRx’s higher possible upside, research analysts plainly believe GoodRx is more favorable than CarGurus.

Risk & Volatility

GoodRx has a beta of 1.37, indicating that its share price is 37% more volatile than the S&P 500. Comparatively, CarGurus has a beta of 1.56, indicating that its share price is 56% more volatile than the S&P 500.

Insider & Institutional Ownership

63.8% of GoodRx shares are owned by institutional investors. Comparatively, 86.9% of CarGurus shares are owned by institutional investors. 4.2% of GoodRx shares are owned by company insiders. Comparatively, 17.2% of CarGurus shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares GoodRx and CarGurus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GoodRx	-7.57%	3.63%	1.72%
CarGurus	-5.57%	11.06%	7.25%

Earnings & Valuation

This table compares GoodRx and CarGurus”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GoodRx	$775.09 million	3.37	-$8.87 million	($0.01)	-696.00
CarGurus	$877.03 million	3.74	$31.10 million	$0.28	112.32

CarGurus has higher revenue and earnings than GoodRx. GoodRx is trading at a lower price-to-earnings ratio than CarGurus, indicating that it is currently the more affordable of the two stocks.

Summary

CarGurus beats GoodRx on 12 of the 15 factors compared between the two stocks.

About GoodRx

GoodRx Holdings, Inc., together with its subsidiaries, offers information and tools that enable consumers to compare prices and save on their prescription drug purchases in the United States. The company operates a price comparison platform that provides consumers with curated, geographically relevant prescription pricing, and access to negotiated prices. It also offers other healthcare products and services, including subscriptions, and pharma manufacturer solutions, as well as telehealth services through the GoodRx Care platform. It serves pharmacy benefit managers who manage formularies and prescription transactions, including establishing pricing between consumers and pharmacies. The company was founded in 2011 and is headquartered in Santa Monica, California.

About CarGurus

CarGurus, Inc. operates an online automotive platform for buying and selling vehicles in the United States and internationally. It operates through two segments, U.S. Marketplace and Digital Wholesale. The company provides an online automotive marketplace where customers can search for new and used car listings from its dealers and sell their car to dealers and other consumers; and paid listings subscriptions for enhanced access to its marketplace that connects dealers to a large audience of informed and engaged consumers. It also offers dealer and non-dealer advertising products for its websites and social media platforms. The company operates online marketplaces under the CarGurus brand in the United States, Canada, and the United Kingdom; Autolist and CarOffer brands in the United States; and PistonHeads brand in the United Kingdom. The company was formerly known as CarGurus LLC and changed its name to CarGurus, Inc. in June 2015. CarGurus, Inc. was founded in 2005 and is headquartered in Cambridge, Massachusetts.