Ernest C. Garcia II, a significant shareholder of Carvana Co. (NYSE:CVNA), has sold a substantial portion of his holdings in the company. According to recent filings, Garcia executed multiple transactions on October 23 and 24, selling a total of 143,020 shares of Carvana's Class A Common Stock. The shares were sold at prices ranging from $194.91 to $202.81, generating approximately $39.65 million in total proceeds.
These transactions were conducted under a pre-established Rule 10b5-1 trading plan, which Garcia and his spouse adopted earlier this year. After the sales, Garcia's direct ownership of Carvana shares has been significantly reduced, although he continues to hold substantial indirect interests through various trusts.
Carvana, known for its innovative online platform for buying and selling used cars, has been experiencing significant market activity, drawing attention from investors and analysts alike. The company's stock has seen fluctuating prices, reflective of broader market trends and company-specific developments.
Investors will be watching closely to see how these sales impact market sentiment and Carvana's stock performance in the coming weeks.
In other recent news, Carvana has been the focus of several analyst adjustments. Wells Fargo increased the price target for Carvana to $250, maintaining its Overweight rating, and raised its earnings per share (EPS) estimates for fiscal years 2024 and 2025 to 72 cents and $2.22 respectively. This adjustment was based on the company's strong performance and promising future prospects.
Simultaneously, BofA Securities boosted its price target to $210 from $185, maintaining a Buy rating, while Stephens reaffirmed its Overweight rating on Carvana, with a steady price target of $190. However, Citi maintains a neutral stance on Carvana despite the positive adjustments.
In terms of company developments, Carvana recently reached a milestone of four million online vehicle transactions. The company's third-quarter unit sales projections have been raised to 107.8 thousand units, marking a 33% increase year-over-year. Additionally, Carvana's management projects a year-over-year growth rate of over 25% for third-quarter unit sales and EBITDA for 2024 between $1 billion and $1.2 billion, surpassing the consensus estimate of $890 million.
InvestingPro Insights
The recent stock sales by Ernest C. Garcia II come at a time when Carvana's stock is showing remarkable strength. According to InvestingPro data, Carvana has delivered an impressive 587.24% return over the past year, with a robust 161.33% gain in the last six months alone. This performance aligns with an InvestingPro Tip indicating that the stock is trading near its 52-week high, currently at 99.42% of that peak.
Despite the strong price performance, InvestingPro Tips suggest that Carvana is trading at a high earnings multiple and high EBIT and EBITDA valuation multiples. This could indicate that the market has priced in significant growth expectations. However, it's worth noting that the company's revenue for the last twelve months stands at $11.67 billion, with a gross profit margin of 18.77%.
Interestingly, while the stock price has soared, Carvana's financial metrics present a mixed picture. The company's revenue growth for the last twelve months was -1.09%, but it showed a 14.89% quarterly revenue growth in Q2 2024. This recent uptick in revenue could be contributing to investor optimism.
For investors seeking a more comprehensive analysis, InvestingPro offers 19 additional tips for Carvana, providing a deeper understanding of the company's financial health and market position.
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