Carvana Stock Sees a 6.6% Gain - Can It Become Even Stronger?

Market Update

In a recent trading session, Carvana’s (CVNA) shares surged by an impressive 6.6%, closing at $188.85. This significant move was backed by substantial volume, with more shares being traded than usual. In contrast to the stock’s 29.5% decline over the past four weeks, this upward momentum is a welcome change.

Reinstatement of Partnership Agreement

The catalyst behind Carvana’s stock jump was the reinstatement of an agreement to sell $4 billion worth of used-car loan receivables to Ally Financial. This one-year deal follows claims by short-seller Hindenburg Research that Ally was distancing itself from its partnership with the online car marketplace.

Upcoming Earnings Report

As investors eagerly await Carvana’s upcoming earnings report, expectations are high for a positive outcome. The company is expected to post quarterly earnings of $0.25 per share, representing a year-over-year change of +125%. Revenue is anticipated to reach $3.33 billion, up 37.2% from the same quarter last year.

Earnings Estimate Revisions

While earnings and revenue growth expectations can provide valuable insights into a stock’s potential strength, empirical research suggests that trends in earnings estimate revisions are strongly correlated with near-term stock price movements. For Carvana, the consensus EPS estimate for the quarter has remained unchanged over the past 30 days. This stability is crucial to monitor, as it may indicate a shift in investor sentiment or market conditions.

Zacks Rank

Carvana’s current Zacks Rank of #1 (Strong Buy) highlights its potential for growth and performance. The complete list of today’s Zacks Rank #1 (Strong Buy) stocks can be viewed here >>>>

Industry Comparison

In comparison, another stock from the same industry, MercadoLibre (MELI), closed the last trading session 1.9% lower at $1,799.42. Over the past month, MELI has returned -5.8%. While both companies operate in the Internet-Commerce industry, their performances differ.

MercadoLibre’s Upcoming Earnings Report

For MercadoLibre, the consensus EPS estimate for the upcoming report remains unchanged at $7.89 over the past month. This represents a change of +142.8% from what the company reported a year ago. With its current Zacks Rank of #3 (Hold), MercadoLibre’s performance may not be as strong as Carvana’s.

Investor Interest

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Free Stock Analysis Reports

To learn more about Carvana Co. (CVNA) and MercadoLibre, Inc. (MELI), please refer to their respective stock analysis reports:

Carvana Co. (CVNA): www.zacks.com
MercadoLibre, Inc. (MELI): www.zacks.com

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Table of Contents

Market Update

The recent surge in Carvana’s shares is a welcome change for investors, who have witnessed a 29.5% decline over the past four weeks. This upward momentum is likely driven by the reinstatement of an agreement to sell $4 billion worth of used-car loan receivables to Ally Financial.

Reinstatement of Partnership Agreement

The deal follows claims by short-seller Hindenburg Research that Ally was distancing itself from its partnership with Carvana. However, this recent development suggests that both parties have reaffirmed their commitment to the agreement.

Upcoming Earnings Report

Earnings Estimate Revisions

Industry Comparison

In comparison, another stock from the same industry, MercadoLibre (MELI), closed the last trading session 1.9% lower at $1,799.42. Over the past month, MELI has returned -5.8%.