Carvana got a rating upgrade from Morgan Stanley analyst Adam Jonas who also almost doubled his price target on the online used-car retailer’s shares.
Jonas raised his rating on Carvana to overweight from equal weight. He boosted price target to a Wall Street high of $420 from $225.
This followed Carvana’s earnings report that showed +65% year-over-year growth in revenue to $1.83 billion for the fourth quarter, beating analysts’ forecast of $1.6 billion. Net loss widened to -87 cents a share from -82 cents in the year-ago quarter.
According to Jonas, Carvana "is uniquely positioned to serve an automotive and transportation [addressable market] that goes far beyond the used-car market, driving potentially far higher growth that is not reflected in today’s share price.” He added, “In our opinion, describing Carvana as just a ‘used car dealer’ is like describing Amazon nearly two decades ago as just an online bookseller.”
The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
The 10-day RSI Indicator for CVNA moved out of overbought territory on March 11, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 40 similar instances where the indicator moved out of overbought territory. In of the 40 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Moving Average Convergence Divergence Histogram (MACD) for CVNA turned negative on March 28, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 46 similar instances when the indicator turned negative. In of the 46 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where CVNA declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
CVNA broke above its upper Bollinger Band on March 20, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Momentum Indicator moved above the 0 level on March 19, 2024. You may want to consider a long position or call options on CVNA as a result. In of 77 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where CVNA advanced for three days, in of 324 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 274 cases where CVNA Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. CVNA’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. CVNA’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 76, placing this stock worse than average.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (42.017) is normal, around the industry mean (9.979). CVNA has a moderately high P/E Ratio (117.213) as compared to the industry average of (36.053). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (2.606). CVNA has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.035). P/S Ratio (1.637) is also within normal values, averaging (87.329).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a car dealer
Industry SpecialtyStores