Bull of the Day: Carvana (CVNA)

Carvana CVNA is a leading e-commerce platform for buying and selling used cars.The company’s earnings outlook melted higher following its latest set of better-than-expected results, helping land the stock into the highly-coveted Zacks Rank #1 (Strong Buy).Image Source: Zacks Investment ResearchIn addition to favorable earnings estimate revisions, the stock resides in the Zacks Internet – Commerce Foundry currently ranked in the top 27% of all Zacks industries. Let’s take a closer look at how the company stacks up.Carvana Outpaces Mag 7 Carvana benefited nicely during the COVID era when consumers were unsure of leaving their homes and facing lockdowns. The stock was entirely forgotten about for years before shocking investors in 2024, up a staggering 380% year-to-date and crushing the general market.The performance has been seemingly ignored by many investors amid the AI frenzy we’ve become accustomed to, with the gains widely outpacing all Mag 7 members. It’s worth noting here that short squeezes have also added fuel to the fire, with a current short interest of 6% nowhere near the 17.5% mark in just December of 2023.Image Source: Zacks Investment ResearchConcerning headline figures in its latest print, CVNA delivered a sizable 180% beat relative to the Zacks Consensus EPS estimate and reported sales 5% ahead of expectations, reflecting growth rates of 178% and 31%, respectively.As shown below, the company’s top line has begun showing sequential growth over recent quarters following a rough 2023 performance. The ‘pandemic boost’ is also easily seen.Image Source: Zacks Investment ResearchThe company overall enjoyed a robust quarter, with retail units of 108.6k growing a sizable 34% year-over-year alongside reaching new profitability milestones. Further, the company’s adjusted EBITDA margin of 11.7% reflected a new all-time best for public automotive retailers.The adjusted EBITDA margin performance is quite commendable, reflecting that the company has been effectively managing costs related to operations, inventory, and labor, which do fluctuate quite a bit in the automotive industry.Putting Everything TogetherInvestors can implement a stellar strategy to find expected winners by taking advantage of the Zacks Rank – one of the most powerful market tools that provides a massive edge.The top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.Carvana CVNA would be an excellent stock for investors to consider, as displayed by its Zack Rank #1 (Strong Buy).7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.1% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carvana Co. (CVNA): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks