Highlights

  • CAR Group delivered H1 FY26 proforma Revenue of $626 million, up 13% in constant currency, with proforma EBITDA of $339 million up 12%, reflecting excellent execution across all geographic segments.
  • Bell Potter has a Buy rating on CAR with a price target of AUD 39.80, representing approximately 49% upside from the current trading price of AUD 26.70 — against a 26% decline over the past year.
  • All four geographic segments — Australia, North America, Latin America, and Asia — delivered double-digit constant currency revenue growth, with reported NPAT rising 16% to $143 million.

CAR Group Limited (ASX:CAR) is a global digital automotive marketplace operator headquartered in Australia. The company's portfolio includes carsales.com.au — Australia's leading online vehicle marketplace — Trader Interactive in North America (serving commercial, recreational, and power sports segments), webmotors in Brazil (jointly owned with Santander), and Encar in South Korea. Together, these businesses form one of the most geographically diversified digital automotive classified businesses globally, with exposure to both developed and high-growth emerging markets.

CAR Group shares were trading at AUD 26.70 on 19 May 2026, up 0.95 or 3.69% on the day, but down approximately 26% over the past twelve months. The disconnect between the 26% share price decline and a Business delivering 13% constant currency revenue growth across all markets is a central puzzle for investors examining the CAR Group Investment case.

Broker Perspective: Bell Potter Maintains Buy at $39.80

Bell Potter has issued a Buy rating on CAR Group with a price target of AUD 39.80, representing approximately 49% upside from current levels.

H1 FY26 Financial Performance: Excellent Across the Board

CAR Group reported H1 FY26 results on 9 February 2026, covering the six months ended 31 December 2025. Proforma revenue of $626 million grew 13% in constant currency on the prior corresponding period, while proforma EBITDA of $339 million grew 12% — reflecting strong Operating Leverage across the global portfolio. On a reported basis, revenue grew 8% in AUD terms and EBITDA grew 11%, with the difference attributable to currency movements. Reported NPAT was $143 million, up 16% on the prior corresponding period, and reported EBITDA-to-Operating Cash Flow conversion was 95% — an exceptional Quality of Earnings metric.

The Interim Dividend was 42.5 cents per share (30% franked), up 10% on the prior corresponding period, signalling the board's confidence in the ongoing cash generation capacity of the business. The dividend payout comes despite a significant investment cycle across the global portfolio, including in North America's Trader Interactive platform and the ongoing Korean market expansion.

Australia: Market Leadership Sustained

The Australian carsales business delivered 8% revenue growth and 8% Adjusted EBITDA growth in H1 FY26, maintaining its dominant market position through strength across all three channels: Dealer (up 10%), Private (up 5%), and Media (up 10%). Dealer growth was driven by higher lead volumes and premium product uptake; Private growth reflected an increase in Instant Offer transactions and premium listing mix; and Media growth benefitted from advertiser Diversification including strong contributions from new manufacturer entrants to the Australian market.

The management team's long-standing strategy of deepening penetration of value-added products — rather than simply growing listing volumes — continues to Yield consistent mid-to-high single-digit revenue growth that is supported by structural advantages in audience scale and Brand Recognition.

North America, Latin America, and Asia: Global Diversity Delivering

Trader Interactive in North America delivered revenue growth of 13% and Adjusted EBITDA growth of 11% in constant currency, demonstrating resilience with commercial markets strong and recreational markets showing signs of improvement. The North American business benefits from CAR Group's expertise in premium depth products and media monetisation, which Trader Interactive has been successfully deploying across its commercial, recreational, and power sports verticals.

Latin America — anchored by webmotors in Brazil — produced outstanding results with revenue up 23% and Adjusted EBITDA up 29% in constant currency, driven by audience growth, strong dealer revenue, increasing finance product penetration, and excellent Chile performance. The combination of high market growth rates and improving monetisation is creating significant operating leverage in this segment.

Encar in South Korea delivered 17% revenue growth and 13% Adjusted EBITDA growth in constant currency. The Guarantee product — which provides a quality inspection and assurance service for used vehicle purchases — reached 60% penetration of all new listings, a remarkable market adoption milestone. The launch of Guarantee 2.0 with strong dealer uptake further enhances the platform's differentiation and revenue yield per transaction.

FY26 Outlook: Full Year Guidance Reaffirmed

Management reaffirmed its FY26 full-year outlook of proforma revenue growth of 12-14% in constant currency at the time of the H1 FY26 result, underpinned by high single-digit growth in Australia, double-digit growth in North America, Latin America, and Asia. With H1 delivering at the upper end of this range, the implied H2 guidance implies a slight moderation — potentially conservative if current trading conditions are sustained.

The key FX dynamic to monitor is the recent appreciation of the Australian dollar against major trading currencies, which could reduce the AUD-reported revenue and earnings when H2 results are eventually disclosed. CAR Group's earnings are naturally hedged at an operating level given most costs and revenues are denominated in local currencies, but translation back to AUD can create reported earnings noise even when underlying business performance is strong.

Conclusion

CAR Group presents a fascinating disconnect between exceptional business performance and a share price that has declined 26% over the past year. With all four geographic segments delivering double-digit constant currency growth, 95% EBITDA-to-cash conversion, and a 10% dividend increase, the fundamental case for the business appears robust. Bell Potter's Buy rating at $39.80 represents a conviction call that the current de-rating is excessive given the quality and diversification of the underlying earnings base. Investors will need to weigh the AUD translation headwinds, the Valuation Premium relative to domestic ASX peers, and the concentration of value in offshore earnings as the key risks against what is a compelling global growth story in digital automotive marketplaces.