Carvana (NYSE:CVNA) Stock Price Expected to Rise, Bank of America Analyst Says

Key Points

• Bank of America raised its price target on Carvana from $360 to $410 but maintained a "neutral" rating, with the new target implying roughly a 0.21% downside from the prior close.
• Carvana reported a blowout quarter — EPS $4.22 vs. $1.10 expected and revenue $5.60B (up 58% year-over-year) — and shares traded near $410 as the company prepares a 5-for-1 stock split on May 7.
• Analysts hold a consensus of Moderate Buy with an average price target of $437.41, while insiders have sold about 56,170 shares (~$20M) and institutional investors own roughly 56.7% of the stock.

Carvana (NYSE:CVNA - Get Free Report) had its price target boosted by equities research analysts at Bank of America from $360.00 to $410.00 in a research note issued to investors on Tuesday,Benzinga reports. The firm currently has a "neutral" rating on the stock. Bank of America's target price indicates a potential downside of 0.21% from the company's previous close.

A number of other analysts have also recently commented on the company. Barclays cut their target price on Carvana from $450.00 to $430.00 and set an "overweight" rating on the stock in a research report on Monday, April 6th. Royal Bank Of Canada cut their target price on Carvana from $500.00 to $440.00 and set an "outperform" rating on the stock in a research report on Thursday, February 19th. Morgan Stanley reiterated an "overweight" rating on shares of Carvana in a research report on Thursday, January 8th. DA Davidson cut their target price on Carvana from $470.00 to $320.00 and set a "neutral" rating on the stock in a research report on Thursday, February 19th. Finally, Argus upgraded Carvana to a "strong-buy" rating in a research report on Tuesday, March 3rd. One equities research analyst has rated the stock with a Strong Buy rating, seventeen have assigned a Buy rating and seven have issued a Hold rating to the company. Based on data from MarketBeat, the company presently has a consensus rating of "Moderate Buy" and a consensus price target of $437.41.

Carvana Trading Up 2.2%

Shares of CVNA traded up $8.89 during midday trading on Tuesday, hitting $410.88. 297,198 shares of the stock were exchanged, compared to its average volume of 3,685,911. Carvana has a 52-week low of $203.50 and a 52-week high of $486.89. The stock has a fifty day simple moving average of $328.87 and a 200 day simple moving average of $369.66. The firm has a market cap of $89.92 billion, a P/E ratio of 51.12 and a beta of 3.61. The company has a debt-to-equity ratio of 1.15, a quick ratio of 2.73 and a current ratio of 4.31.

Carvana's stock is scheduled to split on Thursday, May 7th. The 5-1 split was announced on Friday, March 13th. The newly minted shares will be payable to shareholders after the market closes on Wednesday, May 6th.

Carvana (NYSE:CVNA - Get Free Report) last announced its quarterly earnings data on Wednesday, February 18th. The company reported $4.22 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.10 by $3.12. Carvana had a return on equity of 50.96% and a net margin of 6.92%.The business had revenue of $5.60 billion for the quarter, compared to analysts' expectations of $5.24 billion. During the same period last year, the firm earned $0.56 earnings per share. The company's revenue for the quarter was up 58.0% compared to the same quarter last year. On average, research analysts anticipate that Carvana will post 6.93 EPS for the current fiscal year.

Insider Activity

In related news, Director J Danforth Quayle sold 2,900 shares of the firm's stock in a transaction dated Monday, March 9th. The stock was sold at an average price of $309.97, for a total transaction of $898,913.00. Following the transaction, the director owned 41,913 shares of the company's stock, valued at $12,991,772.61. This trade represents a 6.47% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through this link. Also, COO Benjamin E. Huston sold 10,000 shares of the firm's stock in a transaction dated Monday, February 2nd. The stock was sold at an average price of $411.27, for a total value of $4,112,700.00. Following the transaction, the chief operating officer directly owned 98,652 shares in the company, valued at approximately $40,572,608.04. This represents a 9.20% decrease in their position. The SEC filing for this sale provides additional information. Over the last 90 days, insiders have sold 56,170 shares of company stock valued at $20,020,204. Insiders own 15.19% of the company's stock.

Hedge Funds Weigh In On Carvana

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Federated Hermes Inc. boosted its holdings in Carvana by 124.9% in the 3rd quarter. Federated Hermes Inc. now owns 265,921 shares of the company's stock valued at $100,316,000 after purchasing an additional 147,683 shares in the last quarter. Gavilan Investment Partners LLC purchased a new stake in Carvana in the 3rd quarter valued at approximately $26,030,000. Massachusetts Financial Services Co. MA boosted its holdings in Carvana by 11.2% in the 3rd quarter. Massachusetts Financial Services Co. MA now owns 637,462 shares of the company's stock valued at $240,476,000 after purchasing an additional 64,424 shares in the last quarter. Strs Ohio boosted its holdings in Carvana by 89.9% in the 3rd quarter. Strs Ohio now owns 37,756 shares of the company's stock valued at $14,243,000 after purchasing an additional 17,878 shares in the last quarter. Finally, Allspring Global Investments Holdings LLC boosted its holdings in Carvana by 14.2% in the 3rd quarter. Allspring Global Investments Holdings LLC now owns 193,879 shares of the company's stock valued at $76,662,000 after purchasing an additional 24,129 shares in the last quarter. Hedge funds and other institutional investors own 56.71% of the company's stock.

About Carvana

Carvana Co is an online-only retailer of used vehicles that operates a consumer-facing e-commerce platform for buying and selling cars. The company markets and sells inspected, reconditioned pre-owned vehicles through its website, where shoppers can browse inventory, view detailed 360-degree photos and vehicle history reports, finance purchases, and arrange delivery or pickup. Carvana's model is built around a digital end-to-end car buying experience that aims to simplify vehicle transactions compared with traditional dealerships.

Its products and services include direct retail sales of used cars, trade-in and purchase offers for consumer vehicles, vehicle financing and related protection products, and a seven-day return policy that allows customers to test a vehicle in everyday use.

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