Carvana (NYSE:CVNA) Lowered to Hold Rating by Wall Street Zen

Key Points

• Carvana has been downgraded from a "buy" to a "hold" rating by Wall Street Zen, reflecting analysts' cautious outlook on the company's stock performance.
• Despite the downgrade, 13 analysts still maintain a "buy" rating for Carvana, with a consensus price target of $404.94.
• Major shareholder Ernest C. Garcia II has sold a significant number of shares, reducing his ownership stake, which raises questions about insider confidence in the stock's future.

Carvana (NYSE:CVNA - Get Free Report) was downgraded by research analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a note issued to investors on Friday.

A number of other equities analysts have also recently issued reports on CVNA. Weiss Ratings restated a "hold (c)" rating on shares of Carvana in a report on Saturday, September 27th. Stephens reaffirmed an "overweight" rating and set a $440.00 target price on shares of Carvana in a research report on Tuesday, September 23rd. Gordon Haskett assumed coverage on Carvana in a report on Monday, July 14th. They issued a "hold" rating and a $329.00 price objective on the stock. Piper Sandler upped their target price on Carvana from $340.00 to $440.00 and gave the stock an "overweight" rating in a research note on Thursday, July 31st. Finally, DA Davidson increased their price target on Carvana from $260.00 to $380.00 and gave the stock a "neutral" rating in a research report on Thursday, July 31st. Thirteen equities research analysts have rated the stock with a Buy rating and six have assigned a Hold rating to the stock. Based on data from MarketBeat, the company has a consensus rating of "Moderate Buy" and a consensus price target of $404.94.

Carvana Stock Performance

Shares of CVNA stock traded down $18.15 during trading hours on Friday, reaching $376.56. 1,935,166 shares of the company traded hands, compared to its average volume of 2,725,755. Carvana has a 12-month low of $148.25 and a 12-month high of $413.33. The company has a debt-to-equity ratio of 2.51, a current ratio of 4.00 and a quick ratio of 2.58. The company has a market cap of $81.04 billion, a P/E ratio of 94.38, a P/E/G ratio of 1.29 and a beta of 3.55. The firm has a 50-day moving average price of $364.64 and a 200 day moving average price of $309.02.

Carvana (NYSE:CVNA - Get Free Report) last issued its earnings results on Wednesday, July 30th. The company reported $1.28 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.09 by $0.19. Carvana had a return on equity of 40.57% and a net margin of 3.46%.The company had revenue of $4.84 billion for the quarter, compared to the consensus estimate of $4.54 billion. During the same quarter last year, the company earned ($0.05) EPS. The firm's quarterly revenue was up 41.9% on a year-over-year basis. As a group, sell-side analysts predict that Carvana will post 2.85 earnings per share for the current fiscal year.

Insider Buying and Selling at Carvana

In other Carvana news, major shareholder Ernest C. Garcia II sold 93,376 shares of Carvana stock in a transaction dated Thursday, July 31st. The stock was sold at an average price of $394.16, for a total transaction of $36,805,084.16. Following the completion of the sale, the insider directly owned 6,624 shares of the company's stock, valued at $2,610,915.84. The trade was a 93.38% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. Also, major shareholder Ernest C. Garcia II sold 100,000 shares of Carvana stock in a transaction dated Thursday, July 10th. The stock was sold at an average price of $352.36, for a total value of $35,236,000.00. Following the sale, the insider directly owned 36,237,346 shares of the company's stock, valued at $12,768,591,236.56. This trade represents a 0.28% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last 90 days, insiders have sold 2,307,066 shares of company stock valued at $827,792,454. Company insiders own 17.12% of the company's stock.

Institutional Trading of Carvana

Institutional investors have recently bought and sold shares of the business. Aaron Wealth Advisors LLC acquired a new stake in shares of Carvana during the third quarter worth about $340,000. Corient Private Wealth LLC increased its position in shares of Carvana by 213.4% during the second quarter. Corient Private Wealth LLC now owns 6,494 shares of the company's stock worth $2,188,000 after purchasing an additional 4,422 shares in the last quarter. American Trust acquired a new stake in shares of Carvana during the second quarter worth about $394,000. Orion Porfolio Solutions LLC increased its position in Carvana by 27.3% in the 2nd quarter. Orion Porfolio Solutions LLC now owns 4,380 shares of the company's stock valued at $1,476,000 after acquiring an additional 940 shares during the period. Finally, B. Riley Wealth Advisors Inc. acquired a new position in Carvana in the 2nd quarter valued at about $228,000. 56.71% of the stock is owned by hedge funds and other institutional investors.

Carvana Company Profile

Carvana Co, together with its subsidiaries, operates an e-commerce platform for buying and selling used cars in the United States. Its 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.

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