NYSE:CVNA

Stock Analysis Report

Executive Summary

Carvana Co., together with its subsidiaries, operates an e-commerce platform for buying and selling used cars in the United States.


Snowflake Analysis

High growth potential with imperfect balance sheet.


Similar Companies

Share Price & News

How has Carvana's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CVNA's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

22.2%

CVNA

0.7%

US Specialty Retail

0.5%

US Market


1 Year Return

207.1%

CVNA

18.0%

US Specialty Retail

20.3%

US Market

Return vs Industry: CVNA exceeded the US Specialty Retail industry which returned 18% over the past year.

Return vs Market: CVNA exceeded the US Market which returned 20.3% over the past year.


Shareholder returns

CVNAIndustryMarket
7 Day22.2%0.7%0.5%
30 Day27.8%1.3%2.0%
90 Day18.9%5.6%9.4%
1 Year207.1%207.1%19.8%18.0%22.8%20.3%
3 Yearn/a46.7%39.7%50.1%40.4%
5 Yearn/a50.8%38.5%73.1%54.1%

Price Volatility Vs. Market

How volatile is Carvana's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Carvana undervalued compared to its fair value and its price relative to the market?

15.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CVNA ($106.78) is trading below our estimate of fair value ($126.86)

Significantly Below Fair Value: CVNA is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: CVNA is unprofitable, so we can't compare its PE Ratio to the Specialty Retail industry average.

PE vs Market: CVNA is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate CVNA's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: CVNA is overvalued based on its PB Ratio (50.9x) compared to the US Specialty Retail industry average (1.5x).


Next Steps

Future Growth

How is Carvana forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

62.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CVNA is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: CVNA is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: CVNA's is expected to become profitable in the next 3 years.

Revenue vs Market: CVNA's revenue (28.1% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: CVNA's revenue (28.1% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if CVNA's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Carvana performed over the past 5 years?

-21.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CVNA is currently unprofitable.

Growing Profit Margin: CVNA is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: CVNA is unprofitable, and losses have increased over the past 5 years at a rate of -21.8% per year.

Accelerating Growth: Unable to compare CVNA's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: CVNA is unprofitable, making it difficult to compare its past year earnings growth to the Specialty Retail industry (6.4%).


Return on Equity

High ROE: CVNA has a negative Return on Equity (-104.54%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Carvana's financial position?


Financial Position Analysis

Short Term Liabilities: CVNA's short term assets ($1.1B) exceed its short term liabilities ($507.5M).

Long Term Liabilities: CVNA's short term assets ($1.1B) exceed its long term liabilities ($865.7M).


Debt to Equity History and Analysis

Debt Level: CVNA's debt to equity ratio (333.1%) is considered high.

Reducing Debt: Insufficient data to determine if CVNA's debt to equity ratio has reduced over the past 5 years.


Balance Sheet

Inventory Level: CVNA has a high level of physical assets or inventory.

Debt Coverage by Assets: CVNA's debt is covered by short term assets (assets are 1.1x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: CVNA has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: CVNA has less than a year of cash runway if free cash flow continues to reduce at historical rates of -41.4% each year


Next Steps

Dividend

What is Carvana's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate CVNA's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate CVNA's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CVNA's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CVNA's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CVNA's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.3yrs

Average management tenure


CEO

Ernie Garcia (36yo)

8.1yrs

Tenure

US$2,075,726

Compensation

Mr. Ernest C. Garcia, III, also known as Ernie, has been Chief Executive Officer and President at Carvana Group, LLC since 2012 and serves as its Chairman. Mr. Garcia Founded Carvana Co. and has been its C ...


CEO Compensation Analysis

Compensation vs Market: Ernie's total compensation ($USD2.08M) is below average for companies of similar size in the US market ($USD10.78M).

Compensation vs Earnings: Ernie's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Ernest Garcia
Founder8.1yrsUS$2.08m0.21% $30.8m
Mark Jenkins
Chief Financial Officer5.6yrsUS$1.97m0.0086% $1.3m
Benjamin Huston
Chief Operating Officer8.1yrsUS$1.97m0.0086% $1.3m
Ryan Keeton
Chief Brand Officer8.1yrsUS$1.73m0.020% $2.9m
Daniel Gill
Chief Product Officer4.9yrsUS$1.73m0.0077% $1.1m
Stephen Palmer
Principal Accounting Officer0.6yrsno datano data
Michael Levin
Vice President of Investor Relations0yrsno datano data
Paul Breaux
VP, General Counsel & Secretary4.5yrsno data0.0075% $1.1m
John Mckeon
Vice President of Financial Planning & Analysis0.6yrsno data0.00058% $85.9k

5.3yrs

Average Tenure

36yo

Average Age

Experienced Management: CVNA's management team is seasoned and experienced (5.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ernest Garcia
Founder8.1yrsUS$2.08m0.21% $30.8m
Michael Maroone
Independent Director2.8yrsUS$90.00k0.10% $15.0m
James Danforth Quayle
Independent Director2.8yrsUS$70.00kno data
Ira Platt
Independent Director2.8yrsUS$100.00k0.051% $7.5m
Greg Sullivan
Independent Director2.8yrsUS$95.00kno data
Neha Parikh
Director0.8yrsno data0.0040% $589.7k

2.8yrs

Average Tenure

60yo

Average Age

Experienced Board: CVNA's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 82.6%.


Top Shareholders

Company Information

Carvana Co.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Carvana Co.
  • Ticker: CVNA
  • Exchange: NYSE
  • Founded: 2012
  • Industry: Automotive Retail
  • Sector: Retail
  • Implied Market Cap: US$14.815b
  • Market Cap: US$5.372b
  • Shares outstanding: 157.09m
  • Website: https://www.carvana.com

Number of Employees


Location

  • Carvana Co.
  • 1930 West Rio Salado Parkway
  • Tempe
  • Arizona
  • 85281
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CVNANYSE (New York Stock Exchange)YesClass A Common StockUSUSDApr 2017
CV0DB (Deutsche Boerse AG)YesClass A Common StockDEEURApr 2017

Biography

Carvana Co., together with its subsidiaries, operates an e-commerce platform for buying and selling used cars in the United States. Its platform allows customers to research and identify a vehicle; inspect it using company’s proprietary 360-degree vehicle imaging technology; obtain financing and warranty coverage; purchase the vehicle; and schedule delivery or pick-up from their desktop or mobile devices. The company was founded in 2012 and is headquartered in Tempe, Arizona. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/20 02:49
End of Day Share Price2020/02/19 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.