Bank of America Securities analyst Mike McGovern maintained a Buy rating on Carvana Co (CVNA – Research Report) yesterday and set a price target of $270.00.
Mike McGovern has given his Buy rating due to a combination of factors that suggest potential growth for Carvana Co. Despite the uncertainty surrounding tariffs on imports from Canada and Mexico, there is a possibility that the auto industry might receive exemptions, which could mitigate the impact on Carvana’s costs. The company’s management has indicated that while new car prices might rise due to tariffs, the effect on used car prices, which is Carvana’s primary market, might be less pronounced.
Additionally, the potential implementation of a tax policy allowing auto loan interest deductions could lower the cost of vehicle ownership, benefiting Carvana by making used cars more attractive to consumers. Although higher interest rates pose a risk, Carvana’s ongoing market share gains and improved cost efficiencies per unit provide a strong foundation for future growth. These factors, combined with a price objective of $270.00 USD, support the Buy rating despite the challenges posed by the current economic environment.
According to TipRanks, McGovern is ranked #2571 out of 9384 analysts.
In another report released on March 3, J.P. Morgan also maintained a Buy rating on the stock with a $350.00 price target.