Is Carvana 'GameStop No. 2'? Jim Cramer Says 'Meme People' Are In Control, Short Sellers Are In Trouble

Carvana Co CVNA reported second-quarter results before the market open Wednesday. Despite also announcing an offering of up to $1 billion, the stock is soaring. Jim Cramer says it's GameStop Corp GME all over again. 

What Happened: Carvana reported second-quarter revenue of $2.97 billion, which beat analyst estimates. The used car retailer said gross profit per unit increased 94% year-over-year to $6,520 and the company guided for positive adjusted EBITDA in the third quarter. 

Carvana also announced an agreement with noteholders to reduce total debt, extend maturities and lower near-term cash interest expenses. Furthermore, the company said it may offer and sell up to 35 million shares of its common stock for potential proceeds of up to $1 billion.

See Also: Netflix, Carvana, Tesla, Microsoft, Rocket Lab: Why These 5 Stocks Are Trending Today

Why It Matters: Shareholders don't seem to be bothered by the offering. The stock was up more than 30% at last check, bringing gains for the year above 1,000%.

Wednesday morning on CNBC's "Squawk On The Street," Cramer said the price action is really just being driven by high short interest in the name, similar to what happened with GameStop in early 2021. 

"The meme people seized it and they took it higher. There's 43% short," Cramer said.

"So people are betting this is GameStop No. 2."

The shorts actually look like they are in trouble, Cramer said. Carvana's quarterly results were better than expected and it's possible the company's business model might start working again, he added. 

"What I like about this is that this is a company that basically looked down the gun barrel, stayed in the game," Cramer said. 

The difference between GameStop and Carvana right now is that Carvana management actually took advantage of the stock surge and issued new shares, he said. 

"Now the shorts have to cover on the 35 million because the short case just went away," Cramer said.

It's important to note that GameStop did announce an at-the-market offering following the stock's historic run. The company offered 3.5 million shares, raising $551 million in April 2021, and with the stock still at elevated levels in June, the company sold 5 million additional shares, raising $1.13 billion.

Carvana founder and CEO Ernie Garcia will be interviewed by Cramer Wednesday evening on CNBC's "Mad Money."

CVNA Price Action: Carvana shares were up 32.6% at $52.89 at the time of publication, according to Benzinga Pro.

Photos: zombieite and Owen Byrne from Flickr.