Carvana Co. (CVNA), the online used car retailer, delivered a strong performance in the third quarter, exceeding analysts’ expectations on both revenue and earnings. The company announced revenue of $3.66 billion for the quarter, surpassing the consensus estimate of $3.45 billion, according to Benzinga Pro.
Even more impressive, Carvana reported third-quarter earnings of 64 cents per share, significantly outperforming the analyst forecast of 17 cents per share. This strong performance reflects the company’s continued growth and profitability.
Carvana’s CEO, Ernie Garcia, attributed the company’s success to its “vertically integrated business model” and its unique infrastructure, including the ADESA network. He emphasized the company’s position as the “fastest-growing and most profitable automotive retailer.”
Looking ahead, Carvana anticipates a sequential increase in year-over-year growth for retail units sold in the fourth quarter. The company also expects full-year adjusted EBITDA to be above the high end of its previous guidance range of $1 billion to $1.2 billion.
The positive news sent Carvana’s stock soaring by 23.5% on Thursday, closing at $256.00. This surge in stock price reflects the market’s positive reaction to the company’s strong financial performance.
Following the earnings announcement, several analysts revised their price targets for Carvana. Baird analyst Colin Sebastian maintained a Neutral rating but raised the price target from $160 to $240. Needham analyst Chris Pierce maintained a Buy rating and raised the price target from $200 to $300. JP Morgan analyst Rajat Gupta also maintained an Overweight rating and raised the price target from $230 to $300.
These price target increases suggest that analysts are optimistic about Carvana’s future prospects. The company’s strong financial performance and its commitment to innovation have positioned it as a leader in the online used car market. With a growing demand for used cars and Carvana’s continued focus on growth, the company is well-positioned for further success in the future.
