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CARG vs YELP
Which Stock Would AI Choose? CarGurus (CARG) vs. Yelp (YELP) Stock Comparison
Key Takeaways
- CarGurus (CARG) delivered full-year 2025 revenue from continuing operations of $907 million, growing 14% year-over-year for the second consecutive year, driven by expanding dealer adoption and AI-powered product innovation.
- Yelp (YELP) posted record net revenue of $1.46 billion in 2025, up 4%, with Services advertising revenue reaching an all-time high of $948 million, though its Restaurants, Retail & Other segment declined 6%.
- CarGurus completed the wind-down of its underperforming CarOffer wholesale business in 2025, sharpening its focus on the high-margin Marketplace segment, while Yelp signaled an AI transformation strategy anchored by an agreement with OpenAI and the acquisition of Hatch.
- CARG commands a market capitalization of approximately $3.34 billion with a trailing P/E (price-to-earnings) ratio near 19, while YELP's market cap stands around $1.54 billion with a lower trailing P/E of roughly 12.6.
- Both companies are investing aggressively in artificial intelligence, but CARG has shown stronger revenue growth momentum and margin expansion, while YELP faces headwinds in consumer demand and declining ad clicks.
Introduction
Comparing CARG and YELP offers a compelling lens through which to examine two distinct digital marketplace models operating in very different verticals. CarGurus dominates the online automotive shopping space, connecting car buyers with an extensive dealer network, while Yelp anchors local business discovery through user-generated reviews and advertising. Both companies generate the bulk of their revenue from business-facing advertising and subscription products, and both are betting heavily on artificial intelligence to drive their next phase of growth. For investors evaluating digital platform stocks, this comparison highlights how business model resilience, end-market dynamics, and strategic execution can diverge even among companies that appear structurally similar on the surface.
CARG Overview and Recent Performance
CarGurus, the No. 1 visited automotive shopping site in the U.S., operates an online platform that connects car shoppers with a global network of over 34,000 paying dealers. Recent market activity reflects a company in the midst of a strategic transformation. In 2025, CarGurus completed the wind-down of its CarOffer wholesale transaction business—a segment that had become increasingly unprofitable in a volatile vehicle-pricing environment—allowing management to concentrate resources entirely on the higher-margin Marketplace and data-analytics segments. The pivot has already produced measurable results: full-year 2025 revenue from continuing operations rose 14% to $907 million, GAAP (Generally Accepted Accounting Principles) net income surged 53% to $196.7 million, and non-GAAP Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) expanded 25% to $319 million.
Beyond the financials, CarGurus has leaned heavily into AI-driven product innovation. Tools such as PriceVantage, a machine-learning-based pricing engine, and CG Discover, a generative-AI shopping assistant, have deepened dealer engagement and improved lead conversion. The company's dealer count has grown for seven consecutive quarters, and average revenue per subscribing dealer continues to climb. With a new $250 million share repurchase program announced for 2026 and a market capitalization near $3.34 billion, CARG has demonstrated strengthening operational momentum in recent months.
YELP Overview and Recent Performance
Yelp operates a community-driven platform that connects consumers with local businesses across the United States and Canada, anchored by 330 million cumulative reviews. The company derives approximately 96% of its revenue from advertising, primarily through cost-per-click products sold to small and medium-sized businesses. In 2025, Yelp achieved record net revenue of $1.46 billion, a 4% year-over-year increase, while net income climbed 10% to $146 million. However, the top-line composition reveals a tale of two segments: Services advertising revenue grew 8% to a record $948 million, while the Restaurants, Retail & Other (RR&O) category contracted 6% amid macroeconomic pressure on consumer spending.
Yelp's recent strategic narrative revolves around an AI transformation. The company signed an agreement with OpenAI, acquired Hatch—an AI-powered customer engagement platform—and introduced more than 55 new features and updates during 2025. CEO Jeremy Stoppelman has emphasized making Yelp "more conversational and action-oriented." Yet headwinds persist: total ad clicks declined 7% year-over-year, paying advertising locations shrank by 3%, and the company's 2026 guidance projects Adjusted EBITDA between $310 million and $330 million, reflecting a meaningful step-down from the $369 million recorded in 2025. YELP currently trades with a market capitalization near $1.54 billion and a trailing P/E of approximately 12.6.
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Head-to-Head Comparison
While both CarGurus and Yelp operate advertising-driven digital platforms, their trajectories diverge in several important respects. CarGurus benefits from a more concentrated competitive landscape—it holds the No. 1 position in U.S. automotive shopping—and has demonstrated the ability to grow both dealer count and revenue per dealer simultaneously. Its decision to exit the capital-intensive wholesale business simplifies the investment thesis and has unlocked meaningful margin expansion. By contrast, Yelp operates in a fragmented local-advertising market where it competes against giants such as Google and Meta, and its RR&O segment remains structurally challenged.
On growth dynamics, CARG posted 14% Marketplace revenue growth in 2025, whereas YELP's overall revenue grew just 4%. CarGurus also generated a 22% GAAP net income margin compared to Yelp's 10%, reflecting a more profitable model at scale. However, Yelp holds certain defensive qualities: a debt-free balance sheet, a $334 million cash position as of late 2025, and a lower valuation multiple that may appeal to value-oriented investors. Risk factors differ as well—CARG's exposure to automotive industry cycles contrasts with YELP's dependence on discretionary local business advertising, which has proven sensitive to interest-rate and consumer-spending trends.
Tickeron AI Verdict
Based on observable trends in revenue growth, margin trajectory, strategic clarity, and product-led momentum, Tickeron's AI-driven analytical framework would likely favor CarGurus over Yelp in the current market environment. CARG's consistent double-digit Marketplace expansion, successful exit from a loss-making business unit, aggressive share repurchases, and deepening AI product integration suggest a more robust and improving positioning relative to consensus expectations. Yelp's AI transformation and OpenAI partnership represent meaningful long-term catalysts, but the near-term reality of contracting ad clicks, declining paying locations, and compressed EBITDA (earnings before interest, taxes, depreciation, and amortization) guidance for 2026 introduces a higher degree of uncertainty. As always, relative performance depends on evolving market conditions, and no single metric provides a complete picture.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is CARG is a Buy and YELP is a StrongBuy.
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is undervalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
CARG’s FA Score shows that 1 FA rating(s) are green whileYELP’s FA Score has 0 green FA rating(s).
- CARG’s FA Score: 1 green, 4 red.
- YELP’s FA Score: 0 green, 5 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
CARG’s TA Score shows that 6 TA indicator(s) are bullish while YELP’s TA Score has 7 bullish TA indicator(s).
- CARG’s TA Score: 6 bullish, 4 bearish.
- YELP’s TA Score: 7 bullish, 3 bearish.
Price Growth
CARG (@Automotive Aftermarket) experienced а +8.60% price change this week, while YELP (@Internet Software/Services) price change was +5.30% for the same time period.
The average weekly price growth across all stocks in the @Automotive Aftermarket industry was +1.31%. For the same industry, the average monthly price growth was +1.42%, and the average quarterly price growth was -12.89%.
The average weekly price growth across all stocks in the @Internet Software/Services industry was +2.50%. For the same industry, the average monthly price growth was -5.61%, and the average quarterly price growth was -12.78%.
Reported Earning Dates
CARG is expected to report earnings on Aug 06, 2026.
YELP is expected to report earnings on Aug 06, 2026.
Industries' Descriptions
@Automotive Aftermarket (+1.31% weekly)The Automotive Aftermarket consists of the manufacturing, remanufacturing, distribution, retailing, and installation of vehicle parts and accessories, after the sale of the automobile by the original equipment manufacturer (OEM) to the consumer. The aftermarket parts many not be manufactured by the OEM. According to a Technavio study, the US automotive parts aftermarket size is estimated to grow by USD 24.33 billion during 2018-2022 (CAGR 3%). Like many other industries, the automotive aftermarket is also being intensely penetrated by the digital boom. The online auto parts sales market is predicted to exceed $13B by 2020 (according to a study by Mirakl).
@Internet Software/Services (+2.50% weekly)Companies in this industry typically license software on a subscription basis and it is centrally hosted. Such products usually go by the names web-based software, on-demand software and hosted software. Cloud computing has emerged as a major force in this space, making it possible to save files to a remote database (without requiring them to be saved on local storage device); as long as a device has access to the web, it can access the data and the software programs to run it. This has in many cases facilitated cost efficiency, speed and security of data for businesses and consumers. Alphabet Inc., Facebook, Inc. and Yahoo! Inc. are some well-known names in the internet software/services industry.
| CARG | YELP | CARG / YELP | |
| Capitalization | 3.27B | 1.45B | 225% |
| EBITDA | 283M | 245M | 116% |
| Gain YTD | -5.502 | -13.031 | 42% |
| P/E Ratio | 19.07 | 12.12 | 157% |
| Revenue | 938M | 1.47B | 64% |
| Total Cash | 72M | 110M | 65% |
| Total Debt | 188M | 155M | 121% |
CARG | YELP | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 14 | 33 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 86 Overvalued | 58 Fair valued | |
PROFIT vs RISK RATING 1..100 | 81 | 100 | |
SMR RATING 1..100 | 22 | 45 | |
PRICE GROWTH RATING 1..100 | 49 | 60 | |
P/E GROWTH RATING 1..100 | 100 | 81 | |
SEASONALITY SCORE 1..100 | 50 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
YELP's Valuation (58) in the Internet Software Or Services industry is in the same range as CARG (86) in the Miscellaneous Commercial Services industry. This means that YELP’s stock grew similarly to CARG’s over the last 12 months.
CARG's Profit vs Risk Rating (81) in the Miscellaneous Commercial Services industry is in the same range as YELP (100) in the Internet Software Or Services industry. This means that CARG’s stock grew similarly to YELP’s over the last 12 months.
CARG's SMR Rating (22) in the Miscellaneous Commercial Services industry is in the same range as YELP (45) in the Internet Software Or Services industry. This means that CARG’s stock grew similarly to YELP’s over the last 12 months.
CARG's Price Growth Rating (49) in the Miscellaneous Commercial Services industry is in the same range as YELP (60) in the Internet Software Or Services industry. This means that CARG’s stock grew similarly to YELP’s over the last 12 months.
YELP's P/E Growth Rating (81) in the Internet Software Or Services industry is in the same range as CARG (100) in the Miscellaneous Commercial Services industry. This means that YELP’s stock grew similarly to CARG’s over the last 12 months.
| CARG | YELP | |
|---|---|---|
| RSI ODDS (%) | 3 days ago 69% | 3 days ago 61% |
| Stochastic ODDS (%) | 3 days ago 67% | 3 days ago 73% |
| Momentum ODDS (%) | 3 days ago 75% | 3 days ago 63% |
| MACD ODDS (%) | 3 days ago 73% | 3 days ago 58% |
| TrendWeek ODDS (%) | 3 days ago 72% | 3 days ago 62% |
| TrendMonth ODDS (%) | 3 days ago 75% | 3 days ago 59% |
| Advances ODDS (%) | 5 days ago 72% | 5 days ago 60% |
| Declines ODDS (%) | 11 days ago 69% | 11 days ago 63% |
| BollingerBands ODDS (%) | 5 days ago 81% | 3 days ago 76% |
| Aroon ODDS (%) | 3 days ago 68% | 3 days ago 54% |
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YELP and
Correlation & Price change
A.I.dvisor indicates that over the last year, YELP has been loosely correlated with NRDS. These tickers have moved in lockstep 45% of the time. This A.I.-generated data suggests there is some statistical probability that if YELP jumps, then NRDS could also see price increases.
| Ticker / NAME | Correlation To YELP | 1D Price Change % | ||
|---|---|---|---|---|
| YELP | 100% | +0.61% | ||
| NRDS - YELP | 45% Loosely correlated | N/A | ||
| PPLI - YELP | 43% Loosely correlated | +0.29% | ||
| TWLO - YELP | 42% Loosely correlated | +3.36% | ||
| CARG - YELP | 42% Loosely correlated | +0.67% | ||
| ZG - YELP | 42% Loosely correlated | +1.88% | ||
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