Carvana (NYSE:CVNA) Stock Falls 6.7% - Time to Sell?

Key Points

• Carvana shares fell 6.7% to about $60.70 in midday trading, with volume roughly 56% below the average daily level.
• Despite the decline, analysts maintain a “Moderate Buy” consensus, with an average price target of $84.14, well above the trading price; targets range from $48 to $120.
• Carvana recently exceeded quarterly earnings and revenue expectations, reporting $0.42 EPS and $7.38 billion in revenue, while insiders sold about $27.7 million of stock over the past three months.

Carvana Co. (NYSE:CVNA - Get Free Report) was down 6.7% during mid-day trading on Monday. The company traded as low as $60.70 and last traded at $60.6950. Approximately 5,979,886 shares traded hands during trading, a decline of 56% from the average daily volume of 13,457,734 shares. The stock had previously closed at $65.06.

Wall Street Analyst Weigh In

A number of research analysts recently commented on CVNA shares. Hovde Group upped their price objective on Carvana from $39.50 to $48.00 and gave the company a "market perform" rating in a report on Tuesday, August 4th. Royal Bank Of Canada set a $82.00 target price on Carvana and gave the company an "outperform" rating in a research report on Thursday, July 30th. Needham & Company LLC reaffirmed a "buy" rating and issued a $120.00 price target on shares of Carvana in a research note on Thursday, July 30th. BNP Paribas Exane lowered their price target on Carvana from $86.00 to $69.00 and set a "hold" rating for the company in a report on Thursday, July 30th. Finally, Robert W. Baird set a $72.00 price objective on Carvana in a research report on Thursday, July 30th. One analyst has rated the stock with a Strong Buy rating, fifteen have issued a Buy rating and eight have assigned a Hold rating to the stock. Based on data from MarketBeat, Carvana presently has an average rating of "Moderate Buy" and an average target price of $84.14.

Carvana Stock Performance

The company has a market capitalization of $66.64 billion, a price-to-earnings ratio of 33.52, a PEG ratio of 1.87 and a beta of 3.49. The company has a debt-to-equity ratio of 0.94, a current ratio of 3.93 and a quick ratio of 2.33. The stock has a 50 day simple moving average of $69.01 and a two-hundred day simple moving average of $68.46.

Carvana (NYSE:CVNA - Get Free Report) last issued its earnings results on Wednesday, July 29th. The company reported $0.42 earnings per share for the quarter, topping the consensus estimate of $0.39 by $0.03. The business had revenue of $7.38 billion for the quarter, compared to analyst estimates of $6.90 billion. Carvana had a return on equity of 37.06% and a net margin of 6.26%.The business's quarterly revenue was up 52.4% on a year-over-year basis. During the same quarter last year, the company earned $1.51 EPS. As a group, analysts anticipate that Carvana Co. will post 1.68 earnings per share for the current year.

Insider Activity at Carvana

In other Carvana news, insider Thomas Taira sold 16,789 shares of the business's stock in a transaction on Monday, September 14th. The shares were sold at an average price of $70.58, for a total value of $1,184,967.62. Following the transaction, the insider directly owned 366,987 shares of the company's stock, valued at approximately $25,901,942.46. The trade was a 4.37% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Mark W. Jenkins sold 63,750 shares of the firm's stock in a transaction on Monday, August 3rd. The stock was sold at an average price of $64.50, for a total transaction of $4,111,875.00. Following the completion of the sale, the chief financial officer owned 1,156,534 shares of the company's stock, valued at $74,596,443. This trade represents a 5.22% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 402,564 shares of company stock worth $27,689,555 in the last three months. Company insiders own 15.19% of the company's stock.

Hedge Funds Weigh In On Carvana

Large investors have recently modified their holdings of the business. State Street Corp raised its position in Carvana by 417.1% in the second quarter. State Street Corp now owns 29,435,364 shares of the company's stock worth $1,937,436,000 after acquiring an additional 23,742,422 shares in the last quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC grew its stake in shares of Carvana by 345.8% during the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 3,325,237 shares of the company's stock worth $218,867,000 after purchasing an additional 2,579,295 shares during the period. Amundi increased its holdings in shares of Carvana by 379.7% in the 2nd quarter. Amundi now owns 2,421,045 shares of the company's stock valued at $159,353,000 after purchasing an additional 1,916,349 shares in the last quarter. Capital Research Global Investors increased its holdings in shares of Carvana by 42.9% in the 4th quarter. Capital Research Global Investors now owns 5,700,953 shares of the company's stock valued at $2,405,959,000 after purchasing an additional 1,711,144 shares in the last quarter. Finally, The Manufacturers Life Insurance Company lifted its stake in shares of Carvana by 384.3% in the second quarter. The Manufacturers Life Insurance Company now owns 1,898,095 shares of the company's stock valued at $124,933,000 after purchasing an additional 1,506,145 shares during the period. 56.71% of the stock is owned by hedge funds and other institutional investors.

Carvana Company Profile

Carvana Co NYSE: CVNA is an online used-car retailer that enables consumers to research, purchase, finance and sell vehicles through its website and mobile platform. The company offers a selection of used cars, trucks and SUVs, with vehicle listings that generally include photographs, pricing and vehicle-history information.

Customers can complete much of the vehicle-buying process online, including applying for financing, arranging trade-ins and scheduling vehicle pickup or delivery.

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