Shares of Carvana Co (NYSE:CVNA) are trading higher Monday afternoon as investors position themselves ahead of the company’s second-quarter earnings release, scheduled for after the market closes on Wednesday. Here’s what investors need to know.
What To Know: Analysts are forecasting another strong quarter for the online used-car retailer. The consensus estimate for the second-quarter is EPS of $1.06 on revenue of $4.53 billion.
This follows a blockbuster first quarter where Carvana reported revenue of $4.23 billion and an EPS of $1.51, soundly beating analyst expectations and marking its fifth consecutive beat on top and bottom lines.
The company’s performance has been bolstered by significant tailwinds in the automotive market. A “used-car frenzy” has taken hold, driven by tight new vehicle inventories and supply-chain constraints.
According to Cox Automotive’s Manheim Index, wholesale used vehicle prices jumped 6.3% year-over-year in June, the steepest increase since August 2022. This environment has granted dealers like Carvana strong pricing power and has contributed to margin expansion.
Wall Street sentiment remains largely bullish heading into the report. Recent analyst actions include an upgrade from Oppenheimer, which set a price target of $450, implying over 33% upside from Friday’s close. Firms like JP Morgan and Citigroup also maintain Overweight and Buy ratings, respectively.
While fundamentals appear strong, some technical analysis suggests “cautious optimism” is warranted after a meteoric 163% rally over the trailing year. Investors will be watching Wednesday’s results closely to see if the company’s growth and profitability can justify the stock’s recent run and positive outlook.
Benzinga Edge Rankings: According to Benzinga Edge rankings, which utilize four critical scores to help identify stock strength, Carvana presents the profile of a quintessential high-growth, high-momentum investment. The company scores an exceptionally high 99.69 for Growth and 95.95 for Momentum, reflecting its rapid business expansion and the stock’s powerful rally.
In sharp contrast, CVNA receives a very low Value score of 11.76, suggesting that the stock is trading at a premium valuation and is considered expensive relative to its peers. This data highlights the classic trade-off investors face: paying a high price for a company exhibiting top-tier growth and market momentum.
Price Action: According to data from Benzinga Pro, The stock has a 52-week high of $364.00 and a 52-week low of $118.50.
Read Also: A Used‑Car Frenzy Is Supercharging Carvana, AutoNation Stocks
How To Buy CVNA Stock
By now you're likely curious about how to participate in the market for Carvana – be it to purchase shares, or even attempt to bet against the company.
Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy “fractional shares,” which allows you to own portions of stock without buying an entire share.
In the case of Carvana, which is trading at $336.62 as of publishing time, $100 would buy you 0.3 shares of stock.
If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to “go short” a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading – either way it allows you to profit off of the share price decline.
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