Core Viewpoint - Carvana Co. (NYSE:CVNA) is currently experiencing a downtrend, but there are indications that this may soon reverse, presenting a potential buying opportunity as the stock is oversold and at a support level [1][4]. Group 1: Stock Performance - Carvana's stock is trading lower on Tuesday, continuing a downtrend that began on October 1 [1]. - The stock is currently at a support level of $327, which was also a support level in July and August [1]. - The stock remains oversold, indicating that aggressive sellers have pushed it below its typical range, which may attract buyers anticipating a reversal [4][5]. Group 2: Market Dynamics - In the stock market, previous support levels can become significant again, as regretful sellers may repurchase shares when the price returns to these levels [3][4]. - If enough buy orders are placed at the support level, it can create renewed support, potentially leading to upward pressure on the stock [4][5]. Group 3: Technical Indicators - The Commodity Channel Index (CCI) is used to determine if a stock is oversold; when the CCI falls below a certain threshold, it indicates oversold conditions [6][7]. - The recent movement of the CCI suggests that Carvana may be poised for a rally, as it has just fallen below the red line and is showing signs of reversal [7].

Core Insights - Carvana's stock closed at $338.28, reflecting a +2.75% increase from the previous day, outperforming the S&P 500's gain of 1.56% [1] - Over the past month, Carvana's shares have decreased by 8.99%, underperforming the Retail-Wholesale sector's loss of 5.02% and the S&P 500's gain of 0.41% [1] Financial Performance Expectations - Carvana is set to announce its earnings on October 29, 2025, with projected earnings per share (EPS) of $1.3, indicating a 103.13% increase year-over-year [2] - Revenue is expected to reach $4.94 billion, reflecting a 35.06% increase compared to the same quarter last year [2] - For the entire fiscal year, earnings are projected at $5.15 per share and revenue at $18.94 billion, representing increases of +223.9% and +38.54% respectively from the prior year [3] Analyst Sentiment - Recent changes to analyst estimates for Carvana suggest positive sentiment regarding the company's business operations and profit generation capabilities [4] - The Zacks Rank system, which assesses estimate changes, currently rates Carvana at 3 (Hold), with a recent 1.58% upward adjustment in the EPS estimate over the last 30 days [6] Valuation Metrics - Carvana's Forward P/E ratio stands at 63.99, significantly higher than the industry average of 20.99, indicating that the stock is trading at a premium [7] - The company has a PEG ratio of 1.07, compared to the Internet - Commerce industry's average PEG ratio of 1.43, suggesting a favorable growth outlook relative to its valuation [8] Industry Ranking - The Internet - Commerce industry, which includes Carvana, ranks in the top 22% of all industries, with a Zacks Industry Rank of 53 [8] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1, highlighting the potential for growth within Carvana's industry [9]

Core Insights - Carvana Co. is revolutionizing the used car purchasing process by allowing customers to pick up vehicles from a vending machine-like structure, showcasing an innovative approach in the automotive retail industry [1]. Company Overview - Carvana Co. trades on the NYSE under the ticker CVNA and is recognized for its disruptive business model in the used car market [1]. Analyst Background - Nabeel Bukhari, a law graduate with expertise in corporate law and self-taught financial analysis, provides a unique perspective on business dynamics, enhancing the understanding of Carvana's market position [1].

Group 1 - Carvana is experiencing solid execution with a recovery in 2023 and 2024, achieving record GPU of approximately $7,580 per unit [1] - The company has highly efficient inventory management, with turnover at an all-time high [1] - The macroeconomic environment includes potential interest rate changes that could impact the automotive retail sector [1]

Core Viewpoint - Carvana is navigating scrutiny over its subprime financing but is well-positioned to manage potential losses due to rising used-car prices and resilient securitization structures, maintaining a growth trajectory [1] Financing Exposure - The bankruptcy of subprime lender Tricolor and CarMax's increased reserves have heightened interest in Carvana's financing exposure [2] - Investors are closely examining Carvana's auto loan performance, particularly delinquency and cumulative net loss rates [3] Securitization Analysis - BTIG's analysis indicates that none of Carvana's 14 subprime asset-backed securities (ABS) issuances since 2019 are at risk of impairment, despite cumulative net losses exceeding initial projections by over 500 basis points [4] - Future excess spread income can provide additional credit enhancement to securitizations, mitigating principal loss risks [5] Stress Cases and Resilience - BTIG outlined three stress scenarios indicating resilience, suggesting that even if equity tranches incur losses, their internal rate of return could remain positive [6] - Market access is likely intact even if impairments occur, as other issuers have continued securitizations despite similar credit events [6] Financial Projections - An estimated 13% hit to adjusted EBITDA from increased credit enhancement would still leave Carvana's margins approximately double those of traditional dealers [7] - BTIG projects fiscal year 2025 revenue at $18.97 billion, up from $13.67 billion in fiscal year 2024, and expects further growth to $24.03 billion in fiscal year 2026 [9] Business Model and Market Position - Carvana's vertically integrated model supports growth and profitability despite holding only a 1% share of the used car market [8] - Tariff-driven pricing benefits and expansion into franchise and adjacent markets could enhance Carvana's market reach [8]

Core Insights - Carvana Co. (NYSE: CVNA) has demonstrated resilience against cash flow pressures, emerging as a stronger business than previously anticipated [1]. Company Analysis - The initial expectation was that Carvana would struggle with cash flow issues, but the company has proven this assumption wrong by strengthening its business model [1]. Analyst Background - Dilantha De Silva, an experienced equity analyst with over 10 years in the investment industry, has a focus on small-cap stocks often overlooked by Wall Street [1].

Core Insights - Financial giants are showing bullish sentiment towards Carvana, with 56% of traders being bullish and 30% bearish, indicating a strong interest in the stock's potential [1] - Significant investors are targeting a price range for Carvana between $90.0 and $600.0 over the past three months, suggesting high volatility and potential for growth [2] - Analysts have provided varying ratings on Carvana, with an average target price of $446.67, reflecting a generally positive outlook despite some mixed ratings [11][12] Options Activity - A total of 181 unusual trades were identified for Carvana, with 117 calls valued at $9,083,534 and 64 puts valued at $4,316,587, indicating a preference for bullish positions [1] - The analysis of volume and open interest reveals significant liquidity and investor interest in Carvana's options, particularly within the strike price range of $90.0 to $600.0 over the last 30 days [3][4] - Notable options trades include bullish sweeps for calls with strike prices ranging from $172.75 to $247.6, alongside bearish sweeps for puts at lower strike prices, highlighting diverse trading strategies [8] Company Overview - Carvana operates as an e-commerce platform for buying and selling used cars, generating revenue primarily from retail vehicle sales, wholesale vehicle sales, and additional services such as financing and insurance [9] - The company's business model is heavily reliant on retail vehicle unit sales, which constitute the majority of its revenue, while also capturing additional revenue streams from related services [9] Market Performance - Carvana's stock price is currently at $362.0, reflecting a slight increase of 0.3%, with a trading volume of 1,767,970, indicating active market participation [14] - The upcoming earnings report is anticipated in 20 days, which could further influence market sentiment and stock performance [14]

Core Insights - The third quarter performance of the selected stocks was strong, with 14 out of 18 stocks finishing in positive territory, and 12 of those achieving double-digit gains [2][3] - Notably, four stocks have doubled in value year-to-date, while 13 stocks have recorded double-digit gains [2] - The report provides a ranking of the 18 stocks based on their year-to-date returns and offers insights into their outlook for the fourth quarter [2] Stock Performance Summary - **Beam Therapeutics (BEAM)**: Q3 gain of 42.68%, YTD return of 4.03% [3] - **Bloom Energy (BE)**: Exceptional Q3 gain of 253.55%, YTD return of 309.14% [3] - **Boeing (BA)**: Q3 gain of 3.01%, YTD return of 23.12% [3] - **Carvana (CVNA)**: Q3 gain of 11.95%, YTD return of 90.70% [3] - **CF Industries (CF)**: Q3 loss of 2.50%, YTD return of 6.03% [3] - **Coinbase Global (COIN)**: Q3 loss of 3.71%, YTD return of 50.98% [3] - **Dell Technologies (DELL)**: Q3 gain of 15.64%, YTD return of 26.09% [3] - **Deutsche Bank (DB)**: Q3 gain of 20.94%, YTD return of 108.91% [3] - **Ezcorp (EZPW)**: Q3 gain of 37.18%, YTD return of 49.39% [3] - **LendingClub (LC)**: Q3 gain of 26.27%, YTD return of -6.38% [3] - **Nebius Group (NBIS)**: Q3 gain of 102.91%, YTD return of 356.10% [3] - **Opera (OPRA)**: Q3 gain of 9.21%, YTD return of -2.85% [3] - **Rocket Lab (RKLB)**: Q3 gain of 33.94%, YTD return of 108.99% [3] - **Roku (ROKU)**: Q3 gain of 13.93%, YTD return of 39.22% [3] - **Sea (SE)**: Q3 gain of 11.75%, YTD return of 73.99% [3] - **SEI Investments (SEIC)**: Q3 loss of 5.58%, YTD return of 3.18% [3] - **SoFi Technologies (SOFI)**: Q3 gain of 45.09%, YTD return of 65.62% [3] - **STMicroelectronics NV (STM)**: Q3 loss of 7.07%, YTD return of 16.54% [3] - **Total Gain**: Cumulative YTD return of 1322.80% across all stocks [3] Notable Stock Insights - **Nebius Group NV (NBIS)**: Strong performance in the AI sector, with 10% of the stock's float sold short [3] - **Bloom Energy Inc (BE)**: Benefiting from the data center boom, with a significant Q3 gain [4] - **Rocket Lab Corp (RKLB)**: Showing bullish potential despite a recent stock sale [5] - **Deutsche Bank AG (DB)**: A solid performer in the banking sector, demonstrating value investing characteristics [5] - **Carvana Co (CVNA)**: Positive momentum following earnings, with decreasing short interest [6] - **Sea Limited (SE)**: Consistent performance with three consecutive profitable quarters [6] - **SoFi Technologies (SOFI)**: Testing support levels, with potential for further gains [7] - **Coinbase Global Inc (COIN)**: Continues to face skepticism from analysts despite its crypto focus [8] - **Ezcorp Inc (EZPW)**: Positive bounce off its 200-day moving average, indicating potential growth [8] - **Roku Inc (ROKU)**: Reinventing itself after being oversold [9] - **Dell Technologies Inc (DELL)**: Monitoring external factors like chip imports and tariffs [9] - **Boeing Co (BA)**: Currently in a channel of higher highs, indicating potential for recovery [9] - **STMicroelectronics NV (STM)**: Struggling to recover from a post-earnings gap [10] - **CF Industries (CF)**: Upcoming earnings report to be closely watched [10] - **Beam Therapeutics Inc (BEAM)**: Trading at its highest level since March, showing signs of recovery [10] - **SEI Investments Co (SEIC)**: Facing downward pressure, testing its 200-day moving average [10] - **Opera Ltd (OPRA)**: Struggling to capitalize on previous positive ratings [11] - **LendingClub Corp (LC)**: Despite being the worst performer, still showing resilience with a recent quarterly gain [11] Market Sentiment - Several stocks, including BEAM, COIN, DELL, NBIS, ROKU, and STM, have high Relative Strength Indexes, indicating potential overbought conditions [12] - Despite the strong performance, there are still bullish cases to be made for all 18 stocks listed [12]

Company Performance - Carvana's stock closed at $369.60, down 1.63%, underperforming the S&P 500 which gained 0.37% [1] - Over the last month, Carvana's shares increased by 1.85%, outperforming the Retail-Wholesale sector's gain of 0.38% but lagging behind the S&P 500's gain of 4.26% [1] Upcoming Earnings - Carvana is set to release its earnings on October 29, 2025, with an expected EPS of $1.29, representing a 101.56% increase year-over-year [2] - Revenue is anticipated to be $4.91 billion, indicating a 34.4% increase compared to the same quarter of the previous year [2] Full-Year Estimates - Zacks Consensus Estimates project Carvana's full-year earnings at $5.1 per share and revenue at $18.83 billion, reflecting year-over-year changes of +220.75% and +37.72% respectively [3] - Recent revisions to analyst forecasts for Carvana are important as they indicate short-term business trends and analyst sentiment [3] Valuation Metrics - Carvana has a Forward P/E ratio of 73.64, significantly higher than the industry average of 21.56 [5] - The company has a PEG ratio of 1.23, compared to the Internet - Commerce industry's average PEG ratio of 1.45 [6] Industry Ranking - The Internet - Commerce industry, part of the Retail-Wholesale sector, holds a Zacks Industry Rank of 44, placing it in the top 18% of over 250 industries [6] - The Zacks Rank system, which assesses industry groups based on the average Zacks Rank of individual stocks, shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Core Insights - Recurve Capital reported a strong performance in Q2 2025, achieving a gross return of +31%, significantly outperforming the S&P 500's +10.6% and the Nasdaq's +17.8% [1] - Year-to-date, the fund has returned +14.8% gross and +12% net [1] Company Highlights - Carvana Co. (NYSE:CVNA) was highlighted as a key stock in Recurve Capital's portfolio, with a one-month return of 6.63% and a remarkable 123.45% increase in value over the past 52 weeks [2] - As of October 2, 2025, Carvana's stock closed at $394.71 per share, with a market capitalization of $46.16 billion [2] - Carvana Co. was noted as the largest contributor to Recurve's performance year-to-date, indicating a strong position within the fund [3] - The company has been a long-term holding for Recurve, becoming its largest position, and the decision to retain this investment has been beneficial for performance [3]