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

Fundamentals

High growth potential and slightly overvalued.


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


Market Performance


7 Day Return

2.2%

CVNA

1.5%

US Specialty Retail

0.4%

US Market


1 Year Return

83.8%

CVNA

8.0%

US Specialty Retail

6.9%

US Market

Return vs Industry: CVNA exceeded the US Specialty Retail industry which returned 8% over the past year.

Return vs Market: CVNA exceeded the US Market which returned 6.9% over the past year.


Shareholder returns

CVNAIndustryMarket
7 Day2.2%1.5%0.4%
30 Day-2.2%3.5%-1.1%
90 Day26.3%4.5%-0.5%
1 Year83.8%83.8%9.8%8.0%9.3%6.9%
3 Yearn/a42.6%35.3%45.8%36.4%
5 Yearn/a57.5%43.6%62.9%45.1%

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?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: CVNA ($73.85) is trading below our estimate of fair value ($182.18)

Significantly Undervalued: CVNA is trading below fair value by more than 20%.


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

Low 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 (27.5x) compared to the US Specialty Retail industry average (1.4x).


Next Steps

Future Growth

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

62.8%

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 (2.7%).

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

High Growth Earnings: CVNA's loss is forecast to worsen by 0% next year.

Revenue vs Market: CVNA's revenue (33.4% per year) is forecast to grow faster than the US market (7.2% per year).

High Growth Revenue: CVNA's revenue (33.4% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High 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?

-20.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: CVNA is unprofitable, and losses have increased over the past 5 years at a rate of -20.7% 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 (8.3%).


Return on Equity

High ROE: CVNA has a negative Return on Equity (-75.54%), as it is currently unprofitable.


Return on Assets

ROA vs Industry: CVNA is currently unprofitable, so its Return on Assets is negative.


Return on Capital Employed

ROCE Improving: CVNA is currently unprofitable, so its Return on Capital Employed is negative.


Next Steps

Financial Health

How is Carvana's financial position?


Financial Position Analysis

Short Term Liabilities: CVNA's short term assets ($957.5M) exceeds its short term liabilities ($249.8M)

Long Term Liabilities: CVNA's short term assets (957.5M) exceeds its long term liabilities (830.8M)


Debt to Equity History and Analysis

Debt Level: CVNA's debt to equity ratio (194.6%) 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 1.249490x 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 -42.8% each year


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.0%forecastin3Years0%

Current dividend yield vs market & industry


Stability and Growth of Payments

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.

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

What is the CEO of Carvana's salary, the management and board of directors tenure and is there insider trading?

4.9yrs

Average management tenure


CEO

Ernie Garcia (36yo)

7.8yrs

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: Insufficient data to establish whether Ernie's total compensation is reasonable compared to companies of similar size in the US market.

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


Management Age and Tenure

4.9yrs

Average Tenure

36yo

Average Age

Experienced Management: CVNA's management team is considered experienced (4.9 years average tenure).


Board Age and Tenure

2.4yrs

Average Tenure

60yo

Average Age

Experienced Board: CVNA's board of directors are not considered experienced ( 2.4 years average tenure), which suggests a new board.


Insider Trading

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


Recent Insider Transactions

SellUS$3,317,43820 May 19
Verde Investments, Inc
EntityCompany
Shares48,750
Max PriceUS$68.05
BuyUS$2,970,99007 Jan 19
Spruce House Capital LLC
EntityCompany
Shares100,000
Max PriceUS$29.71
BuyUS$21,321,94719 Dec 18
Spruce House Capital LLC
EntityCompany
Shares630,000
Max PriceUS$34.52
BuyUS$43,85028 Nov 18
Michael Maroone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,000
Max PriceUS$43.85
SellUS$813,01519 Nov 18
DriveTime Sales and Finance Corp, Asset Management Arm
EntityCompany
Shares17,324
Max PriceUS$46.93
BuyUS$889,20014 Nov 18
Michael Maroone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares20,000
Max PriceUS$44.46

Ownership Breakdown


Management Team

  • Ryan Keeton (41yo)

    Chief Brand Officer

    • Tenure: 7.8yrs
    • Compensation: US$1.73m
  • Ernie Garcia (36yo)

    Founder

    • Tenure: 7.8yrs
    • Compensation: US$2.08m
  • Mike Levin

    Vice President of Investor Relations

    • Tenure: 0yrs
  • Dan Gill (36yo)

    Chief Product Officer

    • Tenure: 4.6yrs
    • Compensation: US$1.73m
  • Mark Jenkins (40yo)

    Chief Financial Officer

    • Tenure: 5.3yrs
    • Compensation: US$1.97m
  • Ben Huston (36yo)

    Chief Operating Officer

    • Tenure: 7.8yrs
    • Compensation: US$1.97m
  • Paul Breaux (35yo)

    VP, General Counsel & Secretary

    • Tenure: 4.2yrs
  • John Mckeon

    Vice President of Financial Planning & Analysis

    • Tenure: 0.3yrs
  • Stephen Palmer (42yo)

    Principal Accounting Officer

    • Tenure: 0.3yrs

Board Members

  • Michael Maroone (65yo)

    Director

    • Tenure: 2.4yrs
    • Compensation: US$90.00k
  • Dan Quayle (72yo)

    Director

    • Tenure: 2.4yrs
    • Compensation: US$70.00k
  • Ernie Garcia (36yo)

    Founder

    • Tenure: 7.8yrs
    • Compensation: US$2.08m
  • Ira Platt (55yo)

    Director

    • Tenure: 2.4yrs
    • Compensation: US$100.00k
  • Greg Sullivan (60yo)

    Director

    • Tenure: 2.4yrs
    • Compensation: US$95.00k
  • Neha Parikh

    Director

    • Tenure: 0.5yrs

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$12.146b
  • Market Cap: US$3.676b
  • Shares outstanding: 157.51m
  • 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 ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/20 00:44
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
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.