Carvana (CVNA) Stock Is Up 54% Over The Past Month: What's Going On?

Here's what's sparking increased attention from traders and investors for Carvana Co CVNA on Monday.

What To Know: The online used car retailer’s shares have been on a significant upward trend, fueled by a robust first-quarter earnings report that showcased record performance and led to an optimistic revision of its full-year outlook.

The first quarter saw Carvana achieve impressive financial results, with revenue hitting $4.23 billion and adjusted EBITDA reaching $488 million, both surpassing analysts’ expectations. Retail unit sales soared by 46% year-over-year to a record 133,898 vehicles, driving strong profitability.

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Net income stood at $373 million, representing an 8.8% margin, while the adjusted EBITDA margin climbed to 11.5%. The company also generated a healthy $205 million in free cash flow, exceeding forecasts.

Analysts have responded positively to these results, with several firms raising their price targets for the stock, citing improved operational efficiency and expanding financing margins.

What Else: Looking ahead, Carvana anticipates continued momentum in the second quarter, projecting 138,000 units sold and $536 million in adjusted EBITDA.

The company maintains its long-term goal of selling 3 million units annually with a 13.5% EBITDA margin, seeing substantial growth potential in the evolving online auto retail market.

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Carvana’s business model centers on providing a seamless online platform for buying and selling used vehicles. This includes offering a wide selection of cars and convenient delivery options, often to customers’ doorsteps.

This approach disrupts the traditional dealership model by offering a more streamlined and potentially less stressful car buying experience.

Price Action: Over the past week, Carvana stock is up 7.7% to $302.30, and it has surged 54% over the past month.