Meta Platforms (NASDAQ:META) and Cars.com (NYSE:CARS) Head-To-Head Analysis

Cars.com (NYSE:CARS) and Meta Platforms (NASDAQ:META) are both communication services companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, risk and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Cars.com and Meta Platforms, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cars.com	0	4	3	1	2.62
Meta Platforms	0	8	47	3	2.91

Cars.com currently has a consensus target price of $14.58, indicating a potential upside of 33.32%. Meta Platforms has a consensus target price of $833.12, indicating a potential upside of 29.64%. Given Cars.com’s higher possible upside, research analysts clearly believe Cars.com is more favorable than Meta Platforms.

Profitability

This table compares Cars.com and Meta Platforms’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cars.com	4.73%	18.82%	8.31%
Meta Platforms	31.15%	30.73%	18.08%

Volatility and Risk

Cars.com has a beta of 1.64, indicating that its stock price is 64% more volatile than the S&P 500. Comparatively, Meta Platforms has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500.

Insider and Institutional Ownership

89.2% of Cars.com shares are held by institutional investors. Comparatively, 79.9% of Meta Platforms shares are held by institutional investors. 3.4% of Cars.com shares are held by company insiders. Comparatively, 13.5% of Meta Platforms shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Cars.com and Meta Platforms”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cars.com	$723.24 million	0.81	$20.05 million	$0.57	19.19
Meta Platforms	$200.97 billion	8.15	$60.46 billion	$29.33	21.91

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

Summary

Meta Platforms beats Cars.com on 12 of the 15 factors compared between the two stocks.

About Cars.com

Cars.com Inc., through its subsidiaries, operates as a digital automotive marketplace that connects local car dealers to consumers in the United States. The company offers a suite of digital solutions that creates connections between individuals researching cars or looking to purchase a car with car dealerships and automotive original equipment manufacturers. It also sells online subscription advertising products to car dealerships by its direct sales force, as well as through its affiliate sales channel. In addition, the company sells display advertising to national advertisers. Further, it offers online automotive marketplace service that connects buyers and sellers through Cars.com, Auto.com, DealerRater.com, NewCars.com, PickupTrucks.com, DealerInspire.com, and LaunchDigitalMarketing.com Websites. Its platform hosts approximately 4.9 million new and used vehicle listings and serves approximately 20,000 franchise and independent car dealers. Cars.com Inc. was founded in 1998 and is headquartered in Chicago, Illinois.

About Meta Platforms

Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, and wearables worldwide. It operates in two segments, Family of Apps and Reality Labs. The Family of Apps segment offers Facebook, which enables people to share, discuss, discover, and connect with interests; Instagram, a community for sharing photos, videos, and private messages, as well as feed, stories, reels, video, live, and shops; Messenger, a messaging application for people to connect with friends, family, communities, and businesses across platforms and devices through text, audio, and video calls; and WhatsApp, a messaging application that is used by people and businesses to communicate and transact privately. The Reality Labs segment provides augmented and virtual reality related products comprising consumer hardware, software, and content that help people feel connected, anytime, and anywhere. The company was formerly known as Facebook, Inc. and changed its name to Meta Platforms, Inc. in October 2021. The company was incorporated in 2004 and is headquartered in Menlo Park, California