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Why Is Carvana (CVNA) Up 2.4% Since Last Earnings Report?
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It has been about a month since the last earnings report for Carvana (CVNA - Free Report) . Shares have added about 2.4% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Carvana due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Carvana reported earnings of 14 cents per share for second-quarter 2024, beating the Zacks Consensus Estimate of breakeven earnings. The company had incurred a loss of 55 cents per share in the year-ago quarter.
Revenues of $3.41 billion beat the Zacks Consensus Estimate of $3.23 billion and rose 15% year over year.
Key Highlights
Total gross profit amounted to $715 million, up 43% year over year. Total gross profit per unit (GPU) was $7,049, rising from $529 in the year-ago period but missing our estimate of $8,162. SG&A expenses were $455 million, up 0.6% year over year. Carvana achieved an adjusted EBITDA of $355 million for the second quarter of 2024. Adjusted EBITDA margin in the quarter under review was a record 10.4%, up from 5.2% in the second quarter of 2023.
Segmental Performance
Retail vehicle sales totaled $2.41 billion in the quarter, rising 22.9% year over year and topping our estimate of $2.23 billion on the back of higher-than-expected sales volume. During the reported quarter, the number of vehicles sold to retail customers rose 32.5% to 101,440 from the prior-year period and exceeded our estimate of 89,593 units. Gross profit amounted to $347 million, increasing 70.1% year over year. Gross profit per unit came in at $3,421, significantly up from $2,666 generated in the year-ago period as well as ahead of our expectations of $2,393.
In the second quarter, wholesale vehicle sales totaled $720 million, down 7.3% year over year. Sales breezed past our estimate of $560.2 million amid higher-than-expected unit sales. During the reported quarter, the number of vehicles sold to wholesale customers soared 8.4% to 50,368 from the prior-year period and exceeded our estimate of 46,809 units. Gross profit came in at $89 million, increasing 36.9% from the corresponding quarter of 2023. GPU came in at $878, up 3.4% year over year. However, it lagged our estimate of $1,791.
In the period under consideration, other sales and revenues rose 21.3% year over year to $279 million and beat our forecast of $201 million. Gross profit was $279 million, up 21.3% year over year. GPU came in at $2,750, which declined 8.5% year over year and missed our estimate of $3,978.
Financial Position
Carvana had cash and cash equivalents of $542 million as of Jun 30, 2024, compared with $530 million as of Dec 31, 2023. Long-term debt was $5.43 billion as of Jun 30, 2024, compared with $5.42 billion recorded on Dec 31, 2023.
Outlook
Carvana expects a sequential increase in retail unit sales in the third quarter of 2024. For full-year 2024, it expects adjusted EBITDA in the range of $1-$1.2 billion. The company recorded an adjusted EBITDA of $339 million in 2023.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
The consensus estimate has shifted 159.76% due to these changes.
VGM Scores
Currently, Carvana has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Carvana has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Carvana belongs to the Zacks Internet - Commerce industry. Another stock from the same industry, Groupon (GRPN - Free Report) , has gained 13.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2024.
Groupon reported revenues of $124.62 million in the last reported quarter, representing a year-over-year change of -3.5%. EPS of -$0.02 for the same period compares with -$0.10 a year ago.
For the current quarter, Groupon is expected to post earnings of $0.14 per share, indicating a change of +216.7% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Groupon. Also, the stock has a VGM Score of A.
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Why Is Carvana (CVNA) Up 2.4% Since Last Earnings Report?
It has been about a month since the last earnings report for Carvana (CVNA - Free Report) . Shares have added about 2.4% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Carvana due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Carvana Q2 Earnings Beat Estimates, Revenues Rise Y/Y
Carvana reported earnings of 14 cents per share for second-quarter 2024, beating the Zacks Consensus Estimate of breakeven earnings. The company had incurred a loss of 55 cents per share in the year-ago quarter.
Revenues of $3.41 billion beat the Zacks Consensus Estimate of $3.23 billion and rose 15% year over year.
Key Highlights
Total gross profit amounted to $715 million, up 43% year over year. Total gross profit per unit (GPU) was $7,049, rising from $529 in the year-ago period but missing our estimate of $8,162. SG&A expenses were $455 million, up 0.6% year over year. Carvana achieved an adjusted EBITDA of $355 million for the second quarter of 2024. Adjusted EBITDA margin in the quarter under review was a record 10.4%, up from 5.2% in the second quarter of 2023.
Segmental Performance
Retail vehicle sales totaled $2.41 billion in the quarter, rising 22.9% year over year and topping our estimate of $2.23 billion on the back of higher-than-expected sales volume. During the reported quarter, the number of vehicles sold to retail customers rose 32.5% to 101,440 from the prior-year period and exceeded our estimate of 89,593 units. Gross profit amounted to $347 million, increasing 70.1% year over year. Gross profit per unit came in at $3,421, significantly up from $2,666 generated in the year-ago period as well as ahead of our expectations of $2,393.
In the second quarter, wholesale vehicle sales totaled $720 million, down 7.3% year over year. Sales breezed past our estimate of $560.2 million amid higher-than-expected unit sales. During the reported quarter, the number of vehicles sold to wholesale customers soared 8.4% to 50,368 from the prior-year period and exceeded our estimate of 46,809 units. Gross profit came in at $89 million, increasing 36.9% from the corresponding quarter of 2023. GPU came in at $878, up 3.4% year over year. However, it lagged our estimate of $1,791.
In the period under consideration, other sales and revenues rose 21.3% year over year to $279 million and beat our forecast of $201 million. Gross profit was $279 million, up 21.3% year over year. GPU came in at $2,750, which declined 8.5% year over year and missed our estimate of $3,978.
Financial Position
Carvana had cash and cash equivalents of $542 million as of Jun 30, 2024, compared with $530 million as of Dec 31, 2023. Long-term debt was $5.43 billion as of Jun 30, 2024, compared with $5.42 billion recorded on Dec 31, 2023.
Outlook
Carvana expects a sequential increase in retail unit sales in the third quarter of 2024. For full-year 2024, it expects adjusted EBITDA in the range of $1-$1.2 billion. The company recorded an adjusted EBITDA of $339 million in 2023.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
The consensus estimate has shifted 159.76% due to these changes.
VGM Scores
Currently, Carvana has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Carvana has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Carvana belongs to the Zacks Internet - Commerce industry. Another stock from the same industry, Groupon (GRPN - Free Report) , has gained 13.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2024.
Groupon reported revenues of $124.62 million in the last reported quarter, representing a year-over-year change of -3.5%. EPS of -$0.02 for the same period compares with -$0.10 a year ago.
For the current quarter, Groupon is expected to post earnings of $0.14 per share, indicating a change of +216.7% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Groupon. Also, the stock has a VGM Score of A.