Carvana (NYSE: CVNA) Receives Price Target Increase to $195 by Citi - Retail Unit Tracking Data Projects Strong Third-Quarter Sales Growth
Citi has updated its financial model for Carvana Co., leading to a price target increase from $125.00 to $195.00. The firm's proprietary research indicates that Carvana's third-quarter unit sales may outperform market expectations, with projections reaching approximately 107.8 thousand units, a 33% year-over-year increase.
The increase in sales is attributed to Carvana's growing inventory and demand for retail units, along with operational efficiencies contributing to an expansion in gross profit per unit (GPU) and EBITDA. Despite the stock's 35% rise since September 10, Citi remains cautious, advising an opportunistic approach due to the company's Neutral/High Risk rating.
Other financial reviews and projections from Evercore ISI, BNP Paribas Exane, BofA Securities, and Stephens highlight Carvana's potential for long-term growth and profitability. The company's management anticipates exceeding second-quarter unit sales and achieving EBITDA profitability for 2024.
InvestingPro Insights support Citi's upgraded price target, citing Carvana's revenue and EBITDA growth, low P/E ratio, and positive analyst predictions. With Carvana's stock showing significant momentum and strong returns, investors can access additional tips for a deeper analysis of the company's financial health and market position.
In conclusion, Carvana's performance and growth potential make it an attractive investment opportunity, but investors should remain cautious and consider market risks before making any decisions.