Bank of America Securities analyst Mike McGovern has reiterated their bullish stance on CVNA stock, giving a Buy rating yesterday.
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Mike McGovern’s rating is based on several key considerations. Firstly, Carvana Co reported a higher-than-expected revenue and EBITDA, with retail units sold significantly surpassing market expectations, highlighting robust sales performance. Despite a slight underperformance in the gross profit per unit, the management’s guidance suggests a continuation of growth in both retail units and adjusted EBITDA.
McGovern acknowledges the seasonal weakness that affected the recent quarter but emphasizes the company’s efficiency improvements in reconditioning and transport, which are expected to counterbalance the headwinds. The analyst also notes the company’s strategic investment in inventory and capacity ahead of the tax season, which positions it for future growth. Consequently, despite some short-term challenges, the long-term growth prospects and operational efficiencies justify the Buy rating with an increased price objective.
In another report released yesterday, JMP Securities also maintained a Buy rating on the stock with a $340.00 price target.
Based on the recent corporate insider activity of 269 insiders, corporate insider sentiment is neutral on the stock.