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Carvana (CVNA) Declines More Than Market: Some Information for Investors

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Carvana (CVNA - Free Report) closed the most recent trading day at $378.10, moving -3.26% from the previous trading session. The stock's performance was behind the S&P 500's daily loss of 0.55%. At the same time, the Dow lost 0.19%, and the tech-heavy Nasdaq lost 0.95%.

The company's stock has climbed by 7.93% in the past month, exceeding the Retail-Wholesale sector's gain of 1.22% and the S&P 500's gain of 3.64%.

Analysts and investors alike will be keeping a close eye on the performance of Carvana in its upcoming earnings disclosure. The company is forecasted to report an EPS of $1.29, showcasing a 101.56% upward movement from the corresponding quarter of the prior year. Simultaneously, our latest consensus estimate expects the revenue to be $4.91 billion, showing a 34.4% escalation compared to the year-ago quarter.

For the full year, the Zacks Consensus Estimates project earnings of $5.12 per share and a revenue of $18.83 billion, demonstrating changes of +222.01% and +37.72%, respectively, from the preceding year.

Investors should also pay attention to any latest changes in analyst estimates for Carvana. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.99% higher. Right now, Carvana possesses a Zacks Rank of #3 (Hold).

In terms of valuation, Carvana is currently trading at a Forward P/E ratio of 76.41. For comparison, its industry has an average Forward P/E of 21.61, which means Carvana is trading at a premium to the group.

We can additionally observe that CVNA currently boasts a PEG ratio of 1.28. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. CVNA's industry had an average PEG ratio of 1.52 as of yesterday's close.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 74, putting it in the top 30% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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