Carvana’s Meteoric Rally Hits a Wall—Five-Star Analyst Warns ‘Brace for Impact’
Wall Street’s favorite used-car disruptor just got a reality check. Carvana’s stock surge—fueled by meme traders and hopium—faces a brutal cooldown, according to a top analyst.
### The Gravity-Defying Rally Meets Newton
Carvana’s 300% tear since 2024? Pure adrenaline. Now, the charts scream ‘overbought’—and the smart money’s hitting eject.
### Short Sellers Circle Like Vultures
Betting against Carvana became a bloodsport last quarter. With short interest spiking 22%, the squeeze play might be over.
### The Cynic’s Take
Another ‘revolutionary’ company burning cash faster than a Bitcoin miner in Texas. When will retail investors learn?
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According to Fitch, this trust has a lower-than-average FICO score of 701 compared to other “prime” auto loan deals, as well as a high share of long-term loans. In fact, 95.3% of the loans are over 61 months, while nearly 48% are over 72 months. As a result, this raises questions about the quality and risk of Carvana’s loans. In addition, he warned that Carvana’s second-quarter results could disappoint Wall Street for the first time in five quarters, with EBITDA potentially falling short of expectations.
This WOULD be a big shift from the company’s strong first quarter, where it reported record retail sales, record profitability, and record net income margin. Although Gupta maintained an Overweight rating on Carvana stock, his more cautious tone is weighing on sentiment and likely caused Carvana shares to fall. With concerns about loan quality, compressed margins, and possible weaker Q2 results, investors are now watching closely to see whether Carvana can maintain its momentum going forward.
Is Carvana stock a Buy, Sell, or Hold?
Overall, analysts have a Moderate Buy consensus rating on CVNA stock based on 11 Buys, five Holds, and zero Sells assigned in the past three months, as indicated by the graphic above. Furthermore, the average CVNA price target of $323.93 per share implies 8% downside risk.
