Wall Street Zen Downgrades Carvana (NYSE:CVNA) to Hold

Key Points

• Wall Street Zen has downgraded Carvana (NYSE:CVNA) from a "buy" rating to a "hold" rating, indicating a shift in analyst sentiment.
• Multiple research firms, including Evercore ISI and JMP Securities, have raised their price targets for Carvana, reflecting optimistic outlooks despite the downgrade.
• Insider selling has occurred, with major shareholders offloading significant amounts of stock recently, raising questions about confidence in the company’s future prospects.

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

Several other research firms have also commented on CVNA. Evercore ISI upped their price objective on Carvana from $365.00 to $370.00 and gave the stock an "in-line" rating in a research note on Tuesday, August 12th. JMP Securities upped their target price on shares of Carvana from $440.00 to $460.00 and gave the stock a "market outperform" rating in a report on Thursday, July 31st. Zacks Research raised shares of Carvana from a "hold" rating to a "strong-buy" rating in a report on Monday, October 6th. JPMorgan Chase & Co. upped their target price on shares of Carvana from $415.00 to $425.00 and gave the stock an "overweight" rating in a report on Wednesday, September 17th. Finally, Bank of America upped their target price on shares of Carvana from $375.00 to $425.00 and gave the stock a "buy" rating in a report on Thursday, July 31st. One equities research analyst has rated the stock with a Strong Buy rating, fourteen have issued a Buy rating and six have issued a Hold rating to the company. According to data from MarketBeat, the company has an average rating of "Moderate Buy" and an average target price of $407.44.

Carvana Trading Down 3.3%

NYSE:CVNA opened at $333.28 on Friday. 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 firm has a market capitalization of $71.72 billion, a price-to-earnings ratio of 83.53, a price-to-earnings-growth ratio of 1.08 and a beta of 3.55. Carvana has a one year low of $148.25 and a one year high of $413.33. The business has a fifty day moving average price of $364.10 and a 200-day moving average price of $319.93.

Carvana (NYSE:CVNA - Get Free Report) last posted its quarterly earnings data on Wednesday, July 30th. The company reported $1.28 EPS for the quarter, topping the consensus estimate of $1.09 by $0.19. The firm had revenue of $4.84 billion during the quarter, compared to analyst estimates of $4.54 billion. Carvana had a return on equity of 40.57% and a net margin of 3.46%.Carvana's revenue was up 41.9% on a year-over-year basis. During the same period in the prior year, the business posted ($0.05) EPS. Sell-side analysts forecast that Carvana will post 2.85 EPS for the current year.

Insider Buying and Selling at Carvana

In other Carvana news, major shareholder Ernest C. Garcia II sold 100,000 shares of the stock in a transaction dated Friday, August 1st. The shares were sold at an average price of $371.30, for a total transaction of $37,130,000.00. Following the completion of the transaction, the insider owned 35,142,792 shares of the company's stock, valued at $13,048,518,669.60. This represents a 0.28% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, insider Daniel J. Gill sold 80,000 shares of the stock in a transaction dated Thursday, July 31st. The shares were sold at an average price of $398.91, for a total transaction of $31,912,800.00. Following the transaction, the insider directly owned 197,832 shares of the company's stock, valued at $78,917,163.12. This trade represents a 28.79% decrease in their position. The disclosure for this sale can be found here. Insiders sold 1,678,292 shares of company stock valued at $608,812,907 in the last 90 days. Insiders own 17.12% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently made changes to their positions in CVNA. J.Safra Asset Management Corp lifted its holdings in shares of Carvana by 140.8% in the 1st quarter. J.Safra Asset Management Corp now owns 3,390 shares of the company's stock valued at $709,000 after acquiring an additional 1,982 shares during the last quarter. Berkshire Capital Holdings Inc. lifted its holdings in shares of Carvana by 632,200.0% in the 1st quarter. Berkshire Capital Holdings Inc. now owns 63,230 shares of the company's stock valued at $13,220,000 after acquiring an additional 63,220 shares during the last quarter. Praxis Investment Management Inc. lifted its holdings in shares of Carvana by 56.0% in the 1st quarter. Praxis Investment Management Inc. now owns 4,400 shares of the company's stock valued at $920,000 after acquiring an additional 1,580 shares during the last quarter. Hexagon Capital Partners LLC lifted its holdings in shares of Carvana by 1,791.2% in the 1st quarter. Hexagon Capital Partners LLC now owns 2,591 shares of the company's stock valued at $542,000 after acquiring an additional 2,454 shares during the last quarter. Finally, Stratos Wealth Partners LTD. bought a new position in shares of Carvana in the 1st quarter valued at about $359,000. Institutional investors own 56.71% of the company's stock.

About Carvana

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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