Carvana Reports Record Quarterly Profit but Shares Drop Amid Disappointing Earnings Outlook
Despite reporting record second-quarter profits, Carvana's stock fell nearly 12% as investors reacted to a weaker-than-expected full-year earnings outlook. The online used-car retailer posted net income of $513 million and adjusted EBITDA of $769 million for the quarter, both records compared to the prior year. Carvana saw retail unit sales grow by 38% year-over-year and revenue increase by 52%, driven in part by higher used car prices. However, Jefferies analysts noted that Carvana's full-year EBITDA guidance of $2.7 billion to $3 billion was seen as disappointing given the company’s history of outperforming its targets. Jefferies reiterated a 'Buy' rating on Carvana with an $88 price target and suggested investors consider buying shares during dips, despite concerns over conservative guidance.
Tickers: $CVNA
Topics: earnings guidance profitability stock price movement