Online used car platform Carvana (CVNA) is scheduled to announce its third-quarter results after the market closes on Wednesday, October 29. CVNA stock has rallied 75% year-to-date, as the company’s turnaround efforts and improved financials have impressed investors. Wall Street expects Carvana to report earnings per share (EPS) of $1.30, reflecting a 103% year-over-year jump.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Meanwhile, revenue is expected to increase by 40% to $5.11 billion. Investors will look forward to management’s commentary about credit quality and demand backdrop amid macro challenges.
Ahead of the results, popular investor Jim Chanos stated that he remains short Carvana shares, as he sees lots of “red flags.” Chanos highlighted rising delinquencies, defaults, and the recent collapse of Tricolor Holdings and raised doubts about how Carvana continues to thrive while competitors struggle.
Analysts’ Views Ahead of Carvana’s Q3 Earnings
Heading into the Q3 results, JPMorgan analyst Rajat Gupta increased the price target for Carvana stock to $490 from $425 and reaffirmed a Buy rating. Gupta expects Carvana to deliver another beat and raise this quarter, further bolstering the company’s operational moat in the sector.
Gupta noted that CVNA shares have been sluggish since the last earnings print, mainly due to renewed fears around the health of consumer and auto credit. The analyst contends that these concerns are “overblown,” with negligible impact on near-term economics. Gupta acknowledges that while CVNA is not immune in the event of potential broader macro headwinds, he expects Q3 results to shift focus back to the core operational moat of CVNA’s business, including growth and economics, and its multiple levers, “which should set the company back on a path to re-rating.”
Earlier this month, BTIG analyst Marvin Fong reiterated a Buy rating on Carvana stock with a price target of $450. Fong noted that the recent bankruptcy of subprime lender Tricolor, CarMax’s (KMX) addition of more reserves to its loan portfolio, and general macro concerns have sparked interest in Carvana’s financing activities and exposure. The analyst stated that he is closely following credit developments and understands the growing interest in credit quality. That said, based on his analysis, Fong continues to believe that Carvana’s fundamental value drivers are intact. He stated that Carvana remains a BTIG Top Pick.
AI Analyst Is Bullish on Carvana Stock Ahead of Q3 Print
Interestingly, TipRanks’ AI Analyst has assigned an Outperform rating to Carvana stock with a price target of $393, indicating about 11% upside potential. TipRanks’ AI analyst’s rating is based on solid financial performance and impressive earnings call insights, which highlighted significant growth and profitability improvements.
However, the AI Analyst cautioned about CVNA’s high valuation and mixed technical indicators. While the company’s strategic focus on retail growth and operational efficiency supports a positive outlook, balance sheet stability remains a concern.
Options Traders Anticipate a Major Move on CVNA’s Q3 Earnings
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry, the Options tool does this for you.
Indeed, it currently says that options traders are expecting about a 14.5% move in either direction in CVNA stock in reaction to Q3 2025 results.
Is CVNA a Good Stock to Buy?
Overall, Wall Street has a Strong Buy consensus rating on Carvana stock based on 15 Buys and five Holds. The average CVNA stock price target of $441.56 indicates a 24.3% upside potential from current levels.
