Carvana: Technology-Driven Scale, Data Advantages, and Earnings Momentum Support Buy Rating

William Blair analyst Sharon Zackfia has reiterated their bullish stance on CVNA stock, giving a Buy rating yesterday.

Sharon Zackfia has given his Buy rating due to a combination of factors that underscore Carvana’s strong earnings momentum and growth outlook. She expects the company to deliver record profitability in 2025 and continue expanding adjusted EBITDA by more than 30% in 2026, supported by robust sales trends. Carvana’s value proposition to consumers appears increasingly validated, as it has already become the second-largest seller of used vehicles in the United States. Zackfia believes the company is well on its way toward its long-term target of selling 3 million used cars annually on the shorter end of its timeline, implying very strong compound growth in retail volumes, contingent mainly on its ability to scale operations while sustaining execution quality.

Zackfia also highlights Carvana’s competitive advantages versus traditional used auto dealers, noting that its technology-driven model enables a superior and more convenient customer experience in a historically disliked category. She emphasizes that this advantage is widening over time due to Carvana’s data-driven feedback loop, which enhances inventory breadth, marketing efficiency, delivery speed, and loan pricing. The company’s growing trove of payment performance data is improving its credit models and supporting higher finance-related gross profit per unit, even as it passes some benefits to consumers via lower rates. While some near-term margin expansion may be dampened by reinvestment in customer-facing initiatives, she views these investments as enhancing Carvana’s long-term growth, profitability, and competitive positioning, which justifies a Buy recommendation.

In another report released yesterday, J.P. Morgan also maintained a Buy rating on the stock with a $510.00 price target.

Based on the recent corporate insider activity of 367 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CVNA in relation to earlier this year.