Zacks Investment Research Downgrades Carvana (CVNA) to Sell

Zacks Investment Research downgraded shares of Carvana (NYSE:CVNA) from a hold rating to a sell rating in a report published on Thursday.

According to Zacks, “Carvana Co. provide eCommerce platform for buying used cars. Carvana Co. is headquartered in Phoenix, Arizona. “

Several other brokerages have also recently issued reports on CVNA. Citigroup increased their price objective on Carvana from $67.00 to $77.00 and gave the company a buy rating in a research note on Tuesday, September 11th. They noted that the move was a valuation call. Stephens started coverage on Carvana in a research note on Tuesday, September 4th. They issued an equal weight rating on the stock. Craig Hallum reiterated a hold rating on shares of Carvana in a research note on Thursday, September 13th. Wells Fargo & Co increased their price objective on Carvana from $60.00 to $72.00 and gave the company an outperform rating in a research note on Monday, October 1st. Finally, Wolfe Research started coverage on Carvana in a research note on Tuesday, October 2nd. They issued an outperform rating on the stock. One equities research analyst has rated the stock with a sell rating, four have assigned a hold rating and ten have given a buy rating to the stock. Carvana presently has an average rating of Buy and a consensus target price of $55.86.

NYSE:CVNA traded down $1.30 during trading hours on Thursday, reaching $45.03. 30,983 shares of the stock were exchanged, compared to its average volume of 1,715,810. The company has a quick ratio of 0.78, a current ratio of 1.47 and a debt-to-equity ratio of 0.29. Carvana has a twelve month low of $12.87 and a twelve month high of $72.59. The stock has a market capitalization of $6.49 billion, a price-to-earnings ratio of -35.99 and a beta of 2.13.

Carvana (NYSE:CVNA) last released its quarterly earnings results on Wednesday, August 8th. The company reported ($0.37) EPS for the quarter, missing analysts’ consensus estimates of ($0.34) by ($0.03). Carvana had a negative return on equity of 33.44% and a negative net margin of 5.30%. The firm had revenue of $475.29 million for the quarter, compared to analyst estimates of $425.16 million. During the same quarter last year, the company earned ($0.28) earnings per share. The firm’s revenue for the quarter was up 127.0% on a year-over-year basis. On average, sell-side analysts expect that Carvana will post -1.5 EPS for the current fiscal year.

In other Carvana news, major shareholder Ddfs Partnership Lp sold 896,542 shares of the firm’s stock in a transaction on Thursday, September 13th. The stock was sold at an average price of $64.93, for a total value of $58,212,472.06. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, major shareholder Ernest C. Garcia II sold 13,249 shares of the firm’s stock in a transaction on Tuesday, October 2nd. The shares were sold at an average price of $57.39, for a total value of $760,360.11. Following the completion of the sale, the insider now owns 52,937,458 shares in the company, valued at $3,038,080,714.62. The disclosure for this sale can be found here. Over the last quarter, insiders sold 2,471,036 shares of company stock worth $151,403,886. Insiders own 21.41% of the company’s stock.

A number of institutional investors have recently bought and sold shares of CVNA. BlackRock Inc. raised its stake in Carvana by 1.2% in the first quarter. BlackRock Inc. now owns 956,715 shares of the company’s stock valued at $21,938,000 after buying an additional 11,496 shares in the last quarter. Brown Advisory Inc. purchased a new position in shares of Carvana during the first quarter worth about $483,000. Grubman Wealth Management purchased a new position in shares of Carvana during the second quarter worth about $313,000. Chicago Capital LLC grew its holdings in shares of Carvana by 13.6% during the second quarter. Chicago Capital LLC now owns 700,474 shares of the company’s stock worth $29,140,000 after purchasing an additional 84,068 shares during the last quarter. Finally, Capital Impact Advisors LLC purchased a new position in shares of Carvana during the second quarter worth about $1,934,000. Institutional investors own 25.96% of the company’s stock.

About Carvana

Carvana Co, together with its subsidiaries, operates an e-commerce platform for buying used cars in the United States. The company purchases, reconditions, sells, and delivers vehicles. Its platform allows customers to research and identify a vehicle; inspect it using company's proprietary 360-degree vehicle imaging technology; obtain financing and warranty coverage; purchase the vehicle; and schedule delivery or pick-up.

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