Adam Jonas, an analyst from Morgan Stanley, maintained the Buy rating on Carvana Co. The associated price target remains the same with $290.00.
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Adam Jonas has given his Buy rating due to a combination of factors, including Carvana’s impressive financial performance in the second quarter. The company reported a record Adjusted EBITDA of $601 million, surpassing consensus expectations and marking the fifth consecutive quarter of margin improvement. This strong execution is further highlighted by a 41% year-over-year growth in retail units, showcasing Carvana’s ability to maintain momentum despite challenging market conditions.
Additionally, Carvana’s management has reiterated a positive outlook for both the near and long term. The company plans to increase retail units sold in the upcoming quarter and has set ambitious targets for the future, aiming for 3 million units annually with a 13.5% Adjusted EBITDA margin within the next 5 to 10 years. This confidence is supported by strategic expansions and improvements in production and reconditioning capabilities. The market’s positive reaction, with a 16% rise in share price, reflects investor confidence in Carvana’s continued growth and operational efficiency.
CVNA’s price has also changed moderately for the past six months – from $243.940 to $333.590, which is a 36.75% increase.