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Carvana Co (CVNA)
NYSE:CVNA
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Carvana Co
(NYSE:CVNA)
Rating:78Outperform
Price Target:
$445.00
▲(29.89% Upside)
Positive Factors
Market Positioning
Carvana is seen as a tech disruptor in a highly fragmented market, which could lead to significant competitive advantages.
Operational Performance
Carvana's management team delivering strong operating results well ahead of expectations indicates confidence in the company's performance.
Negative Factors
Competition
Trade-in offers on Amazon could become attractive, making the bidding environment more competitive.
Product Limitations
Certified Pre-Owned vehicles are high-margin units that Carvana does not currently have access to at scale.
Carvana Co (CVNA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$74.27B
Dividend YieldN/A
Average Volume (3M)2.90M
Price to Earnings (P/E)87.6
Beta (1Y)2.71
Revenue Growth39.48%
EPS Growth-34.00%
CountryUS
Employees17,400
SectorConsumer Cyclical
Sector Strength75
IndustrySpecialty Retail
Share Statistics
EPS (TTM)1.38
Shares Outstanding138,083,500
10 Day Avg. Volume3,905,829
30 Day Avg. Volume2,898,603
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap0.71
Enterprise Value/Revenue3.23
Enterprise Value/Gross Profit15.43
Enterprise Value/Ebitda28.21
Forecast
1Y Price Target
$416.61Price Target Upside21.61% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering20
Carvana Co Business Overview & Revenue Model
Company DescriptionCarvana Co., together with its subsidiaries, operates an e-commerce platform for buying and selling used cars in the United States. The company's platform allows customers to research and identify a vehicle; inspect it using company's 360-degree vehicle imaging technology; obtain financing and warranty coverage; purchase the vehicle; and schedule delivery or pick-up from their desktop or mobile devices. Carvana Co. was founded in 2012 and is headquartered in Tempe, Arizona.
How the Company Makes MoneyCarvana generates revenue primarily through the sale of used vehicles. The company sources cars from various channels, including trade-ins and auctions, and then sells them at a markup to consumers. Key revenue streams include retail vehicle sales, financing services through their own financing arm, and extended vehicle service contracts. Additionally, Carvana benefits from partnerships with financial institutions that facilitate vehicle financing for customers. The company also offers vehicle auctions for wholesale buyers, further diversifying its income sources. Factors contributing to its earnings include the growing trend of online vehicle purchasing, a strong brand presence, and an expanding customer base.
Carvana Co Key Performance Indicators (KPIs)
Any
Retail Units Sold
Tracks the number of vehicles sold directly to consumers, indicating sales performance, market demand, and the company's ability to attract and retain customers.
Tracks the number of vehicles sold directly to consumers, indicating sales performance, market demand, and the company's ability to attract and retain customers.
Data provided by:
Main Street Data
Main Street DataCarvana Co Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: 2.70%|
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong performance with record growth in retail units sold and significant improvements in revenue and profitability metrics. The company demonstrated operational efficiencies and maintained a positive outlook for future growth. However, there were some concerns with decreased wholesale GPU and increasing advertising expenses.Q2-2025 Updates
Positive Updates
Record Growth in Retail Units Sold
Retail units sold totaled 143,280 in Q2, an increase of 41% year-over-year, setting a new company record.
Significant Revenue Increase
Revenue for Q2 was $4.84 billion, an increase of 42% year-over-year, marking a new company record.
Strong Profitability Metrics
Adjusted EBITDA was $601 million, a 2 percentage point increase year-over-year, setting a new company record for adjusted EBITDA margin at 12.4%.
Industry-Leading Net Income
Net income was $308 million, an increase of $260 million year-over-year, with a net income margin of 6.4%.
Operational Efficiency Improvements
Operations expenses per retail unit sold decreased significantly, driven by improvements in reconditioning and inbound transport costs.
Negative Updates
Decreased Wholesale GPU
Non-GAAP wholesale GPU decreased by $85, primarily due to faster growth in retail units sold than wholesale marketplace units.
Increased Advertising Expenses
Advertising expense increased by $29 million or $44 per retail unit sold, with expectations for a larger sequential increase in Q3.
Company Guidance
In the Carvana Second Quarter 2025 Earnings Conference Call, the company reported robust growth and profitability metrics, emphasizing its position as the fastest-growing and most profitable automotive retailer. Notably, Carvana achieved a 41% year-over-year increase in retail units sold, totaling 143,280 units, and reported a 42% rise in revenue to $4.84 billion, setting new company records. The adjusted EBITDA margin improved by 200 basis points, reaching a record 12.4%, with adjusted EBITDA totaling $601 million, marking a $246 million increase. The GAAP operating income was $511 million, with a net income of $308 million, reflecting significant profitability improvements. The company also highlighted a strategic focus on expanding its reconditioning capacity and enhancing customer experience, with plans to achieve a long-term goal of selling 3 million cars annually and reaching a 13.5% adjusted EBITDA margin within 5 to 10 years. Looking ahead, Carvana expects a sequential increase in retail units sold in Q3 and forecasts full-year 2025 adjusted EBITDA between $2.0 billion and $2.2 billion, up from $1.38 billion in the previous year.Carvana Co Financial Statement Overview
Summary
Carvana Co displays strong financial recovery with substantial improvements in revenue growth, profit margins, and cash flow generation. However, balance sheet stability is a concern due to low equity levels.Income Statement
Carvana Co has shown impressive revenue growth from 2024 to TTM, with a 19.03% increase, reflecting strong demand and market position. The gross profit margin improved to 21.89% in TTM, indicating better cost management. The net profit margin also improved significantly to 3.46% in TTM, showcasing enhanced profitability. EBIT and EBITDA margins have turned positive, at 9.23% and 11.39% respectively, which is a substantial improvement from previous years.85
Very Positive
Balance Sheet
The company's debt-to-equity ratio has improved to 0.41, reflecting a healthier capital structure. Return on Equity (ROE) for TTM is 32.54%, indicating strong profitability relative to equity. However, the equity ratio is only 18.47%, suggesting reliance on liabilities for financing. While there is progress, the balance sheet stability remains a concern with low equity levels.70
Positive
Cash Flow
Carvana Co's free cash flow is robust at $615 million in TTM, with a healthy operating cash flow to net income ratio of 1.29, indicating efficient cash generation. The free cash flow growth rate has been significant, pointing to improved operational efficiency. The free cash flow to net income ratio of 1.09 further validates cash flow strength, although prior periods showed volatility.78
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.27B | 13.67B | 10.77B | 13.60B | 12.81B | 5.59B |
| Gross Profit | 3.40B | 2.71B | 1.54B | 1.00B | 1.83B | 721.57M |
| EBITDA | 1.86B | 1.36B | 1.16B | -2.15B | -5.00M | -257.16M |
| Net Income | 563.00M | 210.00M | 450.00M | -1.59B | -135.00M | -171.14M |
Balance Sheet | ||||||
| Total Assets | 9.37B | 8.48B | 7.07B | 8.70B | 7.01B | 3.04B |
| Cash, Cash Equivalents and Short-Term Investments | 2.32B | 2.18B | 896.00M | 755.00M | 403.00M | 301.00M |
| Total Debt | 6.11B | 6.05B | 6.71B | 8.82B | 5.77B | 1.87B |
| Total Liabilities | 7.25B | 7.11B | 7.46B | 9.75B | 6.49B | 2.23B |
| Stockholders Equity | 1.73B | 1.26B | 243.00M | -518.00M | 306.00M | 387.60M |
Cash Flow | ||||||
| Free Cash Flow | 615.00M | 827.00M | 716.00M | -1.84B | -3.15B | -968.41M |
| Operating Cash Flow | 724.00M | 918.00M | 803.00M | -1.32B | -2.59B | -608.41M |
| Investing Cash Flow | -76.00M | -13.00M | 31.00M | -2.58B | -627.00M | -345.93M |
| Financing Cash Flow | 675.00M | 261.00M | -868.00M | 3.90B | 3.53B | 1.16B |
Carvana Co Technical Analysis
Positive
342.59
Price Trends
338.34
Positive
293.75
Positive
261.85
Positive
Market Momentum
3.25
Positive
48.73
Neutral
21.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CVNA, the sentiment is Positive. The current price of 342.59 is below the 20-day moving average (MA) of 347.55, above the 50-day MA of 338.34, and above the 200-day MA of 261.85, indicating a neutral trend. The MACD of 3.25 indicates Positive momentum. The RSI at 48.73 is Neutral, neither overbought nor oversold. The STOCH value of 21.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CVNA.
Carvana Co Risk Analysis
Carvana Co disclosed 41 risk factors in its most recent earnings report. Carvana Co reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Carvana Co Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $74.27B | 87.60 | 49.91% | ― | 39.48% | -34.00% | |
73 Outperform | $66.93B | 27.32 | -14.95% | ― | 5.15% | 1.99% | |
72 Outperform | $18.74B | 23.21 | 17.50% | 2.95% | 2.65% | -32.91% | |
70 Outperform | $86.12B | 36.30 | -174.09% | ― | 5.15% | 5.33% | |
61 Neutral | $17.22B | 11.49 | -5.97% | 3.08% | 1.37% | -15.54% | |
54 Neutral | $3.54B | 59.62 | -24.78% | 1.76% | -16.55% | -941.57% | |
45 Neutral | $44.82M | ― | -64.24% | ― | -8.87% | -125.02% |
* Consumer Cyclical Sector Average
Performance Comparison
CVNA
Carvana Co
342.59
186.66
119.71%
AAP
Advance Auto Parts
56.85
-3.85
-6.34%
AZO
AutoZone
3,992.48
779.61
24.27%
GPC
Genuine Parts Company
137.77
3.25
2.42%
ORLY
O'Reilly Auto
101.50
26.87
36.00%
PRTS
CarParts.com Inc
0.76
-0.04
-5.00%
Carvana Co Corporate Events
Executive/Board ChangesShareholder Meetings
Carvana Co Holds Annual Stockholders Meeting, Elects Directors
Neutral
May 6, 2025
On May 5, 2025, Carvana Co. held its annual meeting of stockholders where several key proposals were voted on. The election of directors resulted in Dan Quayle and Gregory Sullivan being elected as Class II directors for a three-year term. Stockholders approved the compensation of the company’s named executive officers and decided to hold annual ‘say-on-pay’ votes. An amendment to the company’s certificate of incorporation for officer exculpation was approved, and Grant Thornton LLP was ratified as the independent auditor for 2025. However, a stockholder proposal for simple majority voting was not approved.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.